Applied Materials (NASDAQ:AMAT) Shares Down 13.6% - Here's What Happened

Key Points

• Applied Materials shares fell 13.6% to $319.25 on trading volume 114% above average, amid a broader semiconductor-stock sell-off.
• Investor worries about a possible slowdown in data-center spending, compounded by weak Qualcomm guidance, pressured chip-equipment stocks. AI-driven equipment demand and advanced packaging remain potential longer-term tailwinds.
• Investors are watching upcoming quarterly results for signs that chip-equipment demand can hold up; the article cites $10.25 billion in revenue as a figure to watch.

Applied Materials, Inc. (NASDAQ:AMAT - Get Free Report)'s share price dropped 13.6% during trading on Thursday. The company traded as low as $316.95 and last traded at $319.25. 16,899,644 shares were traded during trading, an increase of 114% from the average session volume of 7,891,003 shares. The stock had previously closed at $369.40.

Trending Headlines about Applied Materials

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

• Positive Sentiment: AI-driven equipment demand and growth in advanced packaging are cited as longer-term tailwinds for Applied Materials, offering support amid the sector downturn. AMAT Shares Plunge 30% in a Month: Should You Buy, Sell or Hold?
• Positive Sentiment: Institutional buying offered a counterpoint to the sell-off: ETFs reportedly purchased $237 million of AMAT, while Capital Group Dividend Value added $146.3 million. These flows indicate demand from some investors, though they do not guarantee a recovery. ETFs Bought $237.0 Million of Applied Materials Capital Group Dividend Value Buys More AMAT
• Neutral Sentiment: Upcoming quarterly results are a key test, with investors watching whether the company’s chip-equipment outlook can hold up in a tougher investment environment; one report framed the revenue figure to watch at $10.25 billion. Applied Materials Stocks Fall Before a Revenue Test
• Negative Sentiment: The immediate pressure is a broader chip-stock rout, with investors concerned that data-center spending could slow. Weak guidance from Qualcomm added to the worries, dragging down semiconductor-equipment peers alongside AMAT. Chip Stock Rout Deepens

Wall Street Analyst Weigh In

A number of research analysts recently weighed in on the company. The Goldman Sachs Group increased their price objective on Applied Materials from $645.00 to $670.00 and gave the stock a "buy" rating in a research report on Friday, August 14th. B. Riley Financial restated a "buy" rating and set a $700.00 target price (down from $790.00) on shares of Applied Materials in a research report on Friday, August 14th. Royal Bank Of Canada restated an "outperform" rating and set a $600.00 target price on shares of Applied Materials in a research report on Wednesday, October 14th. William Blair started coverage on shares of Applied Materials in a research note on Tuesday, August 11th. They set a "market perform" rating on the stock. Finally, Argus set a $600.00 price target on shares of Applied Materials and gave the company a "buy" rating in a report on Tuesday, August 18th. Thirty research analysts have rated the stock with a Buy rating and nine have given a Hold rating to the company's stock. According to data from MarketBeat, Applied Materials presently has a consensus rating of "Moderate Buy" and an average price target of $632.01.

Applied Materials Price Performance

The company has a 50 day simple moving average of $451.05 and a 200 day simple moving average of $444.63. The company has a market capitalization of $253.36 billion, a price-to-earnings ratio of 27.52, a price-to-earnings-growth ratio of 0.74 and a beta of 1.67. The company has a quick ratio of 1.79, a current ratio of 2.42 and a debt-to-equity ratio of 0.20.

Applied Materials (NASDAQ:AMAT - Get Free Report) last released its quarterly earnings data on Thursday, August 13th. The manufacturing equipment provider reported $3.50 earnings per share (EPS) for the quarter, topping the consensus estimate of $3.40 by $0.10. The company had revenue of $9.12 billion during the quarter, compared to the consensus estimate of $8.99 billion. Applied Materials had a net margin of 30.05% and a return on equity of 38.02%. Applied Materials's revenue for the quarter was up 24.8% on a year-over-year basis. During the same period in the previous year, the firm earned $2.48 earnings per share. Applied Materials has set its Q4 2026 guidance at 3.820-4.220 EPS. As a group, research analysts predict that Applied Materials, Inc. will post 12.79 EPS for the current year.

Applied Materials Announces Dividend

The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, December 10th. Stockholders of record on Thursday, November 19th will be given a dividend of $0.53 per share. The ex-dividend date is Thursday, November 19th. This represents a $2.12 annualized dividend and a dividend yield of 0.7%. Applied Materials's payout ratio is currently 18.28%.

Insider Transactions at Applied Materials

In related news, CAO Adam Sanders sold 725 shares of the stock in a transaction that occurred on Friday, October 2nd. The shares were sold at an average price of $544.56, for a total transaction of $394,806.00. Following the completion of the sale, the chief accounting officer directly owned 3,181 shares of the company's stock, valued at $1,732,245.36. This represents a 18.56% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CFO Brice Hill sold 7,500 shares of Applied Materials stock in a transaction on Tuesday, August 25th. The stock was sold at an average price of $479.25, for a total value of $3,594,375.00. Following the completion of the transaction, the chief financial officer owned 128,613 shares in the company, valued at $61,637,780.25. The trade was a 5.51% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Over the last quarter, insiders sold 9,225 shares of company stock valued at $4,454,181. 0.30% of the stock is currently owned by corporate insiders.

Institutional Investors Weigh In On Applied Materials

A number of institutional investors have recently bought and sold shares of the business. JFS Wealth Advisors LLC boosted its stake in Applied Materials by 4.3% in the 2nd quarter. JFS Wealth Advisors LLC now owns 409 shares of the manufacturing equipment provider's stock worth $296,000 after purchasing an additional 17 shares in the last quarter. Innovative Asset Advisors Group LLC increased its stake in Applied Materials by 2.1% during the 2nd quarter. Innovative Asset Advisors Group LLC now owns 961 shares of the manufacturing equipment provider's stock valued at $695,000 after purchasing an additional 20 shares in the last quarter. Stonebridge Financial Group LLC raised its holdings in Applied Materials by 2.1% in the second quarter. Stonebridge Financial Group LLC now owns 1,003 shares of the manufacturing equipment provider's stock worth $725,000 after buying an additional 21 shares during the last quarter. N.E.W. Advisory Services LLC raised its holdings in Applied Materials by 5.9% in the second quarter. N.E.W. Advisory Services LLC now owns 377 shares of the manufacturing equipment provider's stock worth $273,000 after buying an additional 21 shares during the last quarter. Finally, IMG Wealth Management Inc. lifted its stake in shares of Applied Materials by 13.0% in the second quarter. IMG Wealth Management Inc. now owns 183 shares of the manufacturing equipment provider's stock worth $132,000 after buying an additional 21 shares in the last quarter. 80.56% of the stock is currently owned by institutional investors and hedge funds.

About Applied Materials

Applied Materials, Inc is a technology company that supplies equipment, services and software used to manufacture semiconductors and advanced displays. Its products help customers fabricate the integrated circuits and other components used in computers, mobile devices, data centers, automobiles and a range of connected technologies.

The company's offerings include systems for materials engineering, wafer fabrication, inspection and process control, along with equipment and services designed to improve manufacturing productivity and yield.

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