Applied Materials (NASDAQ:AMAT) Trading Down 8.4% - What's Next?

Key Points

• Applied Materials shares fell 8.4% to about $436.45 on elevated trading volume, amid broader technology and semiconductor weakness driven by oil-price gains, interest-rate uncertainty, concerns about AI infrastructure spending, and rising Chinese competition.
• Despite the selloff, analysts remain broadly optimistic: 27 rate the stock a Buy and one a Strong Buy, with a consensus “Moderate Buy” rating and an average price target of $599.19. Long-term AI-related wafer-fabrication demand remains a potential growth driver.
• The company recently exceeded quarterly earnings and revenue expectations, reported 11.4% year-over-year revenue growth, and declared a quarterly dividend of $0.53. However, insiders have sold 278,088 shares worth approximately $169.7 million over the past 90 days.

Shares of Applied Materials, Inc. (NASDAQ:AMAT - Get Free Report) fell 8.4% on Wednesday . The company traded as low as $436.33 and last traded at $436.45. 10,085,396 shares were traded during trading, an increase of 22% from the average daily volume of 8,289,400 shares. The stock had previously closed at $476.46.

Applied Materials News Roundup

Here are the key news stories impacting Applied Materials this week:

• Positive Sentiment: Applied Materials remains exposed to long-term growth in AI-related wafer-fabrication spending. An investment-fund review cited the company as a beneficiary of increased semiconductor manufacturing investment, supporting the longer-term demand outlook. Applied Materials Rose on AI-Driven Wafer Fabrication Spending
• Neutral Sentiment: Investor searches for AMAT have increased, indicating heightened attention to the stock, but the report provides no new fundamental catalyst or change to earnings expectations. Investors Heavily Search Applied Materials
• Negative Sentiment: Broad market selling intensified as crude oil surged amid renewed U.S.-Iran tensions, while investors awaited the Federal Reserve’s interest-rate decision. Higher energy prices and rate uncertainty are weighing on high-valuation technology and semiconductor shares. Oil Spikes 7%, Nasdaq 100 Sinks Before Fed
• Negative Sentiment: Semiconductor stocks, including Applied Materials, continued to retreat as investors questioned the sustainability and financing of AI infrastructure spending and grew more concerned about competition from Chinese chip-equipment suppliers. Reports that China is advancing domestic immersion DUV tools add a potential long-term threat to demand from Chinese fabs. Semiconductor Stocks Trade Down
• Negative Sentiment: Weakness in KLA and other equipment makers is creating a negative read-through for the wafer-fabrication equipment group. Analysts have questioned whether KLA’s growth can meet expectations despite its upbeat forecast, reinforcing concerns about elevated semiconductor-equipment valuations. KLA Stock Is on Pace for Worst Month Since 1987

Wall Street Analyst Weigh In

AMAT has been the topic of several recent research reports. The Goldman Sachs Group upped their price objective on Applied Materials from $390.00 to $520.00 and gave the company a "buy" rating in a research report on Friday, May 15th. Deutsche Bank Aktiengesellschaft increased their price objective on shares of Applied Materials from $450.00 to $550.00 and gave the stock a "buy" rating in a research report on Friday, May 15th. TD Cowen upped their price target on Applied Materials from $525.00 to $700.00 and gave the stock a "buy" rating in a report on Thursday, July 9th. Mizuho increased their price target on Applied Materials from $540.00 to $650.00 and gave the company an "outperform" rating in a report on Wednesday, July 8th. Finally, Truist Financial set a $575.00 price target on shares of Applied Materials in a report on Thursday, May 28th. One analyst has rated the stock with a Strong Buy rating, twenty-seven have issued a Buy rating and six have issued a Hold rating to the stock. According to data from MarketBeat.com, Applied Materials presently has an average rating of "Moderate Buy" and an average price target of $599.19.

Applied Materials Stock Down 8.4%

The company has a quick ratio of 1.80, a current ratio of 2.51 and a debt-to-equity ratio of 0.22. The company has a market cap of $346.52 billion, a price-to-earnings ratio of 40.98, a price-to-earnings-growth ratio of 1.31 and a beta of 1.57. The firm's 50 day simple moving average is $547.67 and its 200 day simple moving average is $426.93.

Applied Materials (NASDAQ:AMAT - Get Free Report) last announced its quarterly earnings results on Thursday, May 14th. The manufacturing equipment provider reported $2.86 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $2.68 by $0.18. The company had revenue of $7.91 billion during the quarter, compared to analyst estimates of $7.68 billion. Applied Materials had a return on equity of 36.97% and a net margin of 29.31%.The firm's quarterly revenue was up 11.4% on a year-over-year basis. During the same quarter in the previous year, the firm posted $2.39 EPS. Applied Materials has set its Q3 2026 guidance at 3.160-3.560 EPS. Sell-side analysts anticipate that Applied Materials, Inc. will post 12.14 EPS for the current fiscal year.

Applied Materials Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Thursday, September 10th. Shareholders of record on Thursday, August 20th will be given a $0.53 dividend. This represents a $2.12 dividend on an annualized basis and a yield of 0.5%. The ex-dividend date is Thursday, August 20th. Applied Materials's dividend payout ratio is 19.91%.

Insiders Place Their Bets

In related news, SVP Timothy M. Deane sold 8,621 shares of the firm's stock in a transaction that occurred on Monday, June 15th. The shares were sold at an average price of $590.76, for a total transaction of $5,092,941.96. Following the completion of the sale, the senior vice president directly owned 134,631 shares in the company, valued at approximately $79,534,609.56. This trade represents a 6.02% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available at the SEC website. Also, insider Prabu G. Raja sold 10,000 shares of the firm's stock in a transaction on Thursday, June 18th. The stock was sold at an average price of $633.53, for a total value of $6,335,300.00. Following the sale, the insider directly owned 346,642 shares of the company's stock, valued at approximately $219,608,106.26. This represents a 2.80% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Over the last 90 days, insiders have sold 278,088 shares of company stock valued at $169,654,805. 0.30% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Applied Materials

Large investors have recently made changes to their positions in the company. Cornerstone Financial Management LLC acquired a new stake in Applied Materials during the 4th quarter valued at $25,000. Wilkerson Advisory Group LLC bought a new stake in Applied Materials in the fourth quarter worth approximately $26,000. Financial Freedom LLC acquired a new position in Applied Materials during the first quarter worth $28,000. Highline Wealth Partners LLC increased its holdings in shares of Applied Materials by 48.7% during the 4th quarter. Highline Wealth Partners LLC now owns 116 shares of the manufacturing equipment provider's stock valued at $30,000 after acquiring an additional 38 shares during the last quarter. Finally, Joseph Group Capital Management bought a new position in shares of Applied Materials in the fourth quarter valued at approximately $31,000. Institutional investors and hedge funds own 80.56% of the company's stock.

About Applied Materials

Applied Materials, Inc is a U.S.-based supplier of equipment, services and software used to manufacture semiconductor chips, flat panel displays and other advanced materials. Headquartered in Santa Clara, California, the company designs and sells capital equipment and related technologies that enable production of integrated circuits, display panels and materials used across the electronics supply chain.

Applied Materials' offerings include process equipment and factory software that support critical steps in device fabrication, such as deposition, etch, implantation, inspection and metrology, as well as systems for packaging and advanced heterogeneous integration.

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