Applied Materials (NASDAQ:AMAT) Trading Down 9.7% - What's Next?

Key Points

• Applied Materials shares fell 9.7% on Friday, trading as low as $452.91 after closing at $501.70 the prior day, with volume running well above average.
• Despite the selloff, Wall Street remains upbeat: multiple analysts recently raised price targets, and the stock carries a consensus rating of “Moderate Buy” with an average target of $470.13.
• The company reported strong quarterly results, beating EPS and revenue estimates and raising its quarterly dividend to $0.53 per share from $0.46.

Applied Materials, Inc. (NASDAQ:AMAT - Get Free Report) shares traded down 9.7% during trading on Friday . The stock traded as low as $452.91 and last traded at $453.01. 11,673,707 shares changed hands during mid-day trading, an increase of 58% from the average session volume of 7,399,866 shares. The stock had previously closed at $501.70.

Wall Street Analysts Forecast Growth

AMAT has been the topic of a number of research analyst reports. KeyCorp boosted their target price on Applied Materials from $450.00 to $550.00 and gave the stock an "overweight" rating in a research report on Friday, May 15th. Royal Bank Of Canada raised their target price on shares of Applied Materials from $500.00 to $520.00 and gave the stock an "outperform" rating in a research report on Friday, May 15th. Barclays upped their price target on Applied Materials from $450.00 to $500.00 and gave the stock an "overweight" rating in a research note on Friday, May 15th. KGI Securities raised shares of Applied Materials to an "outperform" rating and set a $425.00 price target on the stock in a research report on Friday, February 13th. Finally, DZ Bank upgraded Applied Materials to a "hold" rating in a research note on Monday, February 16th. Twenty-seven investment analysts have rated the stock with a Buy rating and eight have issued a Hold rating to the stock. According to MarketBeat, the stock currently has an average rating of "Moderate Buy" and a consensus price target of $470.13.

Applied Materials Stock Down 9.7%

The firm has a 50 day simple moving average of $407.26 and a two-hundred day simple moving average of $341.53. The stock has a market cap of $359.67 billion, a P/E ratio of 42.54, a P/E/G ratio of 1.40 and a beta of 1.67. The company has a debt-to-equity ratio of 0.22, a quick ratio of 1.80 and a current ratio of 2.51.

Applied Materials (NASDAQ:AMAT - Get Free Report) last announced its 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 for 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%.Applied Materials's revenue for the quarter was up 11.4% compared to the same quarter last year. During the same period in the previous year, the firm earned $2.39 earnings per share. Applied Materials has set its Q3 2026 guidance at 3.160-3.560 EPS. Equities research analysts predict that Applied Materials, Inc. will post 12.02 earnings per share for the current year.

Applied Materials Increases Dividend

The business also recently declared a quarterly dividend, which will be paid on Thursday, June 11th. Stockholders of record on Thursday, May 21st will be paid a dividend of $0.53 per share. This is a boost from Applied Materials's previous quarterly dividend of $0.46. The ex-dividend date is Thursday, May 21st. This represents a $2.12 annualized dividend and a dividend yield of 0.5%. Applied Materials's dividend payout ratio is currently 19.91%.

Insider Activity

In other news, Director Judy Bruner sold 1,128 shares of the company's stock in a transaction dated Tuesday, May 26th. The stock was sold at an average price of $450.00, for a total transaction of $507,600.00. Following the completion of the sale, the director owned 26,544 shares in the company, valued at approximately $11,944,800. This represents a 4.08% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which can be accessed through this hyperlink. Also, CAO Adam Sanders sold 268 shares of the stock in a transaction that occurred on Friday, May 22nd. The shares were sold at an average price of $434.22, for a total value of $116,370.96. Following the sale, the chief accounting officer owned 4,280 shares of the company's stock, valued at approximately $1,858,461.60. The trade was a 5.89% decrease in their position. The SEC filing for this sale provides additional information. Corporate insiders own 0.30% of the company's stock.

Institutional Investors Weigh In On Applied Materials

A number of hedge funds and other institutional investors have recently bought and sold shares of AMAT. Financial Freedom LLC bought a new stake in shares of Applied Materials during the first quarter worth $28,000. Cornerstone Financial Management LLC bought a new position in Applied Materials during the fourth quarter worth about $25,000. Whipplewood Advisors LLC lifted its holdings in Applied Materials by 218.8% during the first quarter. Whipplewood Advisors LLC now owns 102 shares of the manufacturing equipment provider's stock worth $35,000 after acquiring an additional 70 shares in the last quarter. Wilkerson Advisory Group LLC bought a new stake in shares of Applied Materials in the fourth quarter valued at about $26,000. Finally, MBM Wealth Consultants LLC bought a new stake in shares of Applied Materials in the first quarter valued at about $38,000. 80.56% of the stock is owned by institutional investors and hedge funds.

Applied Materials Company Profile

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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