Applied Materials (NASDAQ:AMAT) Shares Up 5.2% - Here's Why

Key Points

• Applied Materials shares jumped 5.2% to about $512 amid optimism over the semiconductor-equipment boom, improving margins and strong long-term customer commitments.
• Analyst sentiment remains positive, with a consensus “Moderate Buy” rating and a $629.38 price target; several firms raised targets, though Morgan Stanley cut its target to $563 and kept an “equal weight” rating.
• The company recently exceeded quarterly earnings and revenue expectations, reporting $3.50 EPS and $9.12 billion in revenue, up 24.8% year over year. Applied Materials also declared a quarterly dividend of $0.53 per share.

Shares of Applied Materials, Inc. (NASDAQ:AMAT - Get Free Report) were up 5.2% during trading on Tuesday. The stock traded as high as $513.28 and last traded at $512.01. 7,121,143 shares changed hands during mid-day trading, a decline of 11% from the average session volume of 7,980,771 shares. The stock had previously closed at $486.76.

Applied Materials News Summary

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

• Positive Sentiment: Investors remain optimistic about the chipmaking-equipment boom, which has accelerated growth at Applied Materials. The company’s positioning and industry prospects could support additional stock-price upside. Better Semiconductor Equipment Stock: Applied Materials vs. Lam Research
• Positive Sentiment: Improving margins and long-term customer commitments are strengthening the growth outlook, supporting the view that Applied Materials can deliver solid future results. Why It’s Time to Load Up on Applied Materials Stock
• Positive Sentiment: Wall Street’s average price target implies meaningful potential upside, while positive earnings-estimate revisions provide an additional near-term catalyst. Wall Street Analysts Believe Applied Materials Could Rally
• Neutral Sentiment: Commentary highlights Applied Materials’ exceptional multiyear shareholder returns but questions whether its current scale and valuation have changed the investment profile, potentially prompting investors to reassess future capital returns and growth. Is Applied Materials Still The Business You Bought?
• Negative Sentiment: Morgan Stanley lowered its price target from $642 to $563 and maintained an “equal weight” rating. Although the revised target still indicates upside, the cut signals more cautious expectations and limits the immediate bullish impact. Morgan Stanley Cuts Applied Materials’ Price Target

Analysts Set New Price Targets

AMAT has been the subject of several analyst reports. Berenberg Bank raised their price target on shares of Applied Materials from $575.00 to $675.00 and gave the stock a "buy" rating in a report on Monday, August 17th. Wall Street Zen upgraded shares of Applied Materials from a "hold" rating to a "buy" rating in a research report on Saturday. Citigroup reissued a "buy" rating and set a $710.00 target price (up from $550.00) on shares of Applied Materials in a research note on Monday, August 3rd. Argus set a $600.00 target price on shares of Applied Materials and gave the company a "buy" rating in a report on Tuesday, August 18th. Finally, The Goldman Sachs Group upped their price target on shares of Applied Materials from $645.00 to $670.00 and gave the company a "buy" rating in a research report on Friday, August 14th. One analyst has rated the stock with a Strong Buy rating, thirty have issued a Buy rating and eight have issued a Hold rating to the company's stock. Based on data from MarketBeat, the stock has a consensus rating of "Moderate Buy" and a consensus target price of $629.38.

Applied Materials Stock Up 5.2%

The firm's 50 day moving average price is $487.97 and its two-hundred day moving average price is $471.76. The company has a market cap of $406.33 billion, a P/E ratio of 44.14, a price-to-earnings-growth ratio of 1.35 and a beta of 1.60. The company has a debt-to-equity ratio of 0.20, a quick ratio of 1.79 and a current ratio of 2.42.

Applied Materials (NASDAQ:AMAT - Get Free Report) last issued its earnings results 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 business had revenue of $9.12 billion for 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%. Applied Materials's revenue was up 24.8% on a year-over-year basis. During the same period in the prior year, the firm earned $2.48 earnings per share. Applied Materials has set its Q4 2026 guidance at 3.820-4.220 EPS. Equities research analysts anticipate that Applied Materials, Inc. will post 12.79 EPS for the current fiscal year.

Applied Materials Dividend Announcement

The company also recently announced a quarterly dividend, which will be paid on Thursday, December 10th. Stockholders of record on Thursday, November 19th will be paid a $0.53 dividend. The ex-dividend date is Thursday, November 19th. This represents a $2.12 annualized dividend and a dividend yield of 0.4%. Applied Materials's dividend payout ratio (DPR) is currently 18.28%.

Insider Transactions at Applied Materials

In related news, Director Judy Bruner sold 1,000 shares of the business's stock in a transaction dated Tuesday, September 8th. The stock was 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 of the company's stock, valued at $11,877,960. The trade was a 3.77% decrease in their position. The sale was disclosed in a filing with the SEC, which is available at the SEC website. Also, CFO Brice Hill sold 7,500 shares of the company's stock in a transaction that occurred 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 transaction, the chief financial officer directly owned 128,613 shares in the company, valued at approximately $61,637,780.25. This trade represents a 5.51% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders own 0.30% of the company's stock.

Hedge Funds Weigh In On Applied Materials

Large investors have recently modified their holdings of the company. JFS Wealth Advisors LLC raised its stake in shares of Applied Materials by 4.3% in the second 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 during the last quarter. Innovative Asset Advisors Group LLC raised its position in Applied Materials by 2.1% in the 2nd quarter. Innovative Asset Advisors Group LLC now owns 961 shares of the manufacturing equipment provider's stock worth $695,000 after buying an additional 20 shares during the last quarter. Stonebridge Financial Group LLC lifted its stake in Applied Materials by 2.1% during the 2nd quarter. Stonebridge Financial Group LLC now owns 1,003 shares of the manufacturing equipment provider's stock valued at $725,000 after acquiring an additional 21 shares during the period. N.E.W. Advisory Services LLC boosted its holdings in shares of Applied Materials by 5.9% during the 2nd quarter. N.E.W. Advisory Services LLC now owns 377 shares of the manufacturing equipment provider's stock valued at $273,000 after acquiring an additional 21 shares during the last quarter. Finally, IMG Wealth Management Inc. grew 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 acquiring an additional 21 shares during the period. 80.56% of the stock is currently owned by institutional investors.

About Applied Materials

Applied Materials, Inc is a global supplier of equipment, services and software used to manufacture semiconductor chips, flat-panel displays and other advanced electronic products. Its technologies help customers build and enhance materials at the nanoscale, supporting processes such as deposition, etching, inspection, metrology and packaging.

The company's offerings include semiconductor manufacturing systems, process-control and inspection equipment, and services designed to improve the performance, productivity and longevity of production equipment.

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