Applied Materials (NASDAQ:AMAT) Stock Price Down 2.1% - Time to Sell?

Key Points

• Applied Materials shares fell 2.1% to $509.57, but remain above their 50-day and 200-day moving averages. The stock trades at a relatively elevated P/E ratio of 43.93 following a substantial 12-month advance.
• The company’s fundamentals and industry outlook remain broadly positive: quarterly EPS and revenue exceeded estimates, revenue rose 24.8% year over year, and demand for semiconductor equipment may benefit from AI-related investment and expanded TSMC capital spending.
• Analysts maintain a “Moderate Buy” consensus with an average price target of $640.20, although insider selling and the stock’s premium valuation create near-term risks. Applied Materials also declared a quarterly dividend of $0.53 per share, yielding approximately 0.4%.

Applied Materials, Inc. (NASDAQ:AMAT - Get Free Report)'s stock price fell 2.1% during trading on Thursday. The company traded as low as $502.65 and last traded at $509.57. Approximately 6,317,167 shares were traded during mid-day trading, a decline of 20% from the average daily volume of 7,888,742 shares. The stock had previously closed at $520.65.

Key Applied Materials News

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

• Positive Sentiment: Applied Materials’ AGS business is gaining momentum, supported by AI-enabled services, recurring revenue and continued demand for semiconductor-fabrication equipment. The outlook suggests potential growth through 2030. Can Applied Materials Sustain Momentum in Its AGS Business?
• Positive Sentiment: Industry commentary indicates that TSMC could spend as much as $64 billion on capital expenditures and may still be underbuilding capacity. More fab investment would likely support demand for Applied Materials’ chipmaking systems. TSMC Plans Up to $64 Billion in Capex
• Positive Sentiment: Recent comparisons with Qualcomm, Marvell Technology and Nvidia highlight an acceleration in Applied Materials’ revenue during the first half of 2026, improving its growth profile relative to several AI-related companies. Analysts also continue to cite dependable earnings and AI-driven chip complexity as potential upside drivers. Applied Materials vs. Qualcomm Revenue Trends
• Neutral Sentiment: Jim Cramer reportedly sees additional value in Applied Materials beyond its earnings multiple, although the stock’s elevated valuation makes sustained earnings growth important. The shares trade at a premium after a substantial 12-month advance. Jim Cramer Sees More to Applied Materials Than Its Earnings Multiple
• Negative Sentiment: Reports of insider selling have added near-term pressure and may raise concerns about whether company insiders view the recent rally as an opportunity to take profits. Applied Materials Stock Falls After Insider Selling

Analysts Set New Price Targets

A number of analysts have weighed in on AMAT shares. William Blair started coverage on Applied Materials in a research note on Tuesday, August 11th. They issued a "market perform" rating on the stock. Zacks Research raised Applied Materials from a "hold" rating to a "strong-buy" rating in a research report on Wednesday, July 1st. HSBC decreased their target price on Applied Materials from $683.00 to $641.00 and set a "buy" rating for the company in a research note on Friday, August 14th. 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, Citigroup reissued a "buy" rating and set a $710.00 price objective (up from $550.00) on shares of Applied Materials in a report on Monday, August 3rd. One equities research analyst has rated the stock with a Strong Buy rating, thirty have given a Buy rating and eight have issued a Hold rating to the company. According to data from MarketBeat.com, Applied Materials has a consensus rating of "Moderate Buy" and an average target price of $640.20.

Applied Materials Trading Down 2.1%

The company has a debt-to-equity ratio of 0.20, a current ratio of 2.42 and a quick ratio of 1.79. The company has a market capitalization of $404.39 billion, a price-to-earnings ratio of 43.93, a price-to-earnings-growth ratio of 1.48 and a beta of 1.60. The business's 50 day simple moving average is $488.74 and its 200 day simple moving average is $480.57.

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

Applied Materials Dividend Announcement

The company also recently declared 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 yield of 0.4%. The ex-dividend date of this dividend is Thursday, November 19th. Applied Materials's dividend payout ratio is currently 18.28%.

Insider Activity at Applied Materials

In other Applied Materials news, Director Judy Bruner sold 1,000 shares of Applied Materials stock in a transaction that occurred on Tuesday, September 8th. The stock was sold at an average price of $465.00, for a total value of $465,000.00. Following the sale, the director owned 25,544 shares of the company's stock, valued at approximately $11,877,960. The trade was a 3.77% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, CAO Adam Sanders sold 725 shares of the stock in a transaction that occurred on Friday, October 2nd. The stock was sold at an average price of $544.56, for a total value of $394,806.00. Following the transaction, the chief accounting officer directly owned 3,181 shares of the company's stock, valued at approximately $1,732,245.36. This trade represents a 18.56% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders sold a total of 9,225 shares of company stock worth $4,454,181 over the last 90 days. Company insiders own 0.30% of the company's stock.

Institutional Trading of Applied Materials

Institutional investors have recently added to or reduced their stakes in the stock. BlackRock Inc. increased its stake 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 purchasing an additional 1,237,685 shares in the last quarter. State Street Corp boosted its position in shares of Applied Materials by 85.4% in 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 in the last quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC grew its stake in Applied Materials by 17.1% in the 4th quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 10,688,232 shares of the manufacturing equipment provider's stock valued at $2,746,769,000 after acquiring an additional 1,558,749 shares during the last quarter. Amundi increased its holdings in 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 in the last quarter. Finally, Van ECK Associates Corp increased its holdings in Applied Materials by 16.2% during the 2nd 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 acquiring an additional 1,073,879 shares in the last quarter. Hedge funds and other institutional investors own 80.56% of the company's stock.

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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