Applied Materials (NASDAQ:AMAT) Shares Up 2.2% - What's Next?

Key Points

• Applied Materials shares gained 2.2% to $395.93, while trading volume was 19% below the average session volume.
• AMAT plans to increase its stake in Dutch chip-packaging equipment maker Besi from about 9% to approximately 20%, strengthening its position in advanced packaging technologies supporting AI and high-performance computing.
• Analyst sentiment remains broadly positive, with a consensus “Moderate Buy” rating and a $632.70 price target, though the company faces risks from a semiconductor-equipment selloff and potentially weaker AI-related capital spending.

Applied Materials, Inc. (NASDAQ:AMAT - Get Free Report) shares rose 2.2% on Tuesday. The company traded as high as $398.95 and last traded at $395.93. Approximately 6,364,960 shares changed hands during mid-day trading, a decline of 19% from the average session volume of 7,878,540 shares. The stock had previously closed at $387.59.

Applied Materials News Summary

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

• Positive Sentiment: Applied Materials agreed to increase its ownership of Dutch chip-packaging equipment maker Besi to approximately 20%, up from about 9%, through an accelerated share purchase. The investment strengthens their partnership in advanced packaging and hybrid-bonding technologies used in artificial-intelligence and high-performance-computing hardware, signaling AMAT’s long-term commitment to AI-related semiconductor infrastructure. Applied Materials to Increase its Strategic Investment in BE Semiconductor Industries
• Positive Sentiment: Besi shares rose sharply following the announcement, highlighting investor enthusiasm for the companies’ combined position in next-generation chip assembly and packaging. The transaction could give AMAT deeper strategic access to growth markets driven by AI chip complexity. Shares in BE Semiconductor jump over 9% after Applied Materials raises stake to 20%
• Positive Sentiment: Bernstein reiterated a Buy rating on AMAT, providing additional analyst support. Recent coverage has also focused on the company’s ambition to expand operating margins toward 40%, which could improve earnings growth if achieved. Applied Materials receives a Buy from Bernstein
• Neutral Sentiment: Exchange-traded funds were reported as buyers of AMAT, potentially adding technical support, but the impact may be limited compared with company-specific fundamentals. ETFs Are Buying Applied Materials
• Negative Sentiment: Applied Materials remains exposed to a semiconductor-equipment selloff and concerns that cooling AI sentiment or a pause in capital spending could pressure near-term demand. The Besi investment also commits capital before the partnership’s potential revenue benefits are realized. Semiconductor Equipment Selloff Challenges Applied Materials

Analyst Upgrades and Downgrades

A number of research firms have recently weighed in on AMAT. New Street Research cut their price target on Applied Materials from $580.00 to $525.00 and set a "neutral" rating for the company in a report on Friday, August 14th. Argus set a $600.00 price objective on Applied Materials and gave the stock a "buy" rating in a report on Tuesday, August 18th. KeyCorp raised their price objective on Applied Materials from $550.00 to $750.00 and gave the company an "overweight" rating in a research report on Monday, June 29th. Wall Street Zen upgraded shares of Applied Materials from a "hold" rating to a "buy" rating in a research note on Saturday, September 26th. Finally, HSBC decreased their price target on shares of Applied Materials from $683.00 to $641.00 and set a "buy" rating for the company in a research report on Friday, August 14th. Thirty investment analysts have rated the stock with a Buy rating and nine have issued a Hold rating to the stock. According to MarketBeat.com, Applied Materials has a consensus rating of "Moderate Buy" and a consensus price target of $632.70.

Applied Materials Stock Up 2.2%

The company has a debt-to-equity ratio of 0.20, a quick ratio of 1.79 and a current ratio of 2.42. The stock has a 50 day moving average price of $468.42 and a 200 day moving average price of $440.96. The company has a market cap of $314.21 billion, a P/E ratio of 34.13, a P/E/G ratio of 1.05 and a beta of 1.60.

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

Applied Materials Announces Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, December 10th. Investors of record on Thursday, November 19th will be issued a dividend of $0.53 per share. This represents a $2.12 annualized dividend and a dividend yield of 0.5%. The ex-dividend date is Thursday, November 19th. Applied Materials's dividend payout ratio (DPR) is currently 18.28%.

Insider Buying and Selling at Applied Materials

In other Applied Materials news, CFO Brice Hill sold 7,500 shares of the company's stock in a transaction dated Tuesday, August 25th. The shares were sold at an average price of $479.25, for a total transaction of $3,594,375.00. Following the completion of the sale, the chief financial officer directly owned 128,613 shares in the company, valued at $61,637,780.25. This represents a 5.51% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. Also, Director Judy Bruner sold 1,000 shares of the firm's stock in a transaction that occurred on Tuesday, September 8th. The shares were sold at an average price of $465.00, for a total value of $465,000.00. Following the completion of the sale, the director directly owned 25,544 shares in the company, valued at $11,877,960. This trade represents a 3.77% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold 9,225 shares of company stock worth $4,454,181 over the last ninety days. 0.30% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Applied Materials

A number of institutional investors have recently added to or reduced their stakes in the company. BlackRock Inc. increased its holdings in Applied Materials by 1.6% in the 2nd quarter. BlackRock Inc. now owns 80,212,518 shares of the manufacturing equipment provider's stock valued at $57,993,650,000 after buying an additional 1,237,685 shares during the period. State Street Corp grew its position in shares of Applied Materials by 85.4% during the 2nd quarter. State Street Corp now owns 69,525,842 shares of the manufacturing equipment provider's stock worth $50,267,184,000 after buying an additional 32,018,892 shares during the period. Amundi raised its position in shares of Applied Materials by 19.0% during the 2nd quarter. Amundi now owns 7,808,207 shares of the manufacturing equipment provider's stock valued at $5,645,344,000 after acquiring an additional 1,246,876 shares during the last quarter. Van ECK Associates Corp lifted its stake in Applied Materials by 16.2% in the second quarter. Van ECK Associates Corp now owns 7,713,599 shares of the manufacturing equipment provider's stock valued at $5,576,932,000 after buying an additional 1,073,879 shares during the period. Finally, Bank of America Corp DE bought a new position in Applied Materials during the 2nd quarter worth approximately $5,252,863,000. 80.56% of the stock is 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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