Applied Materials (AMAT)
NASDAQ:AMAT
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Applied Materials
(NASDAQ:AMAT)
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Rating:72Outperform
Price Target:
$432.00
â–²(8.83% Upside)
Action:ReiteratedDate:03/14/26
The score is driven primarily by strong margins, cash generation, and a solid balance sheet, supported by a generally positive demand outlook from the latest earnings call. Offsetting factors include very weak TTM revenue growth, a mixed/soft near-term technical picture, and a relatively rich valuation with a low dividend yield; the export compliance settlement adds a modest additional risk.
Positive Factors
Cash Generation & Margins
Applied’s high trailing margins and roughly $6.2B of free cash flow create durable financial flexibility. This cash generation funds R&D, capacity expansion, shareholder returns and working capital needs, enabling the company to sustain investments and weather semiconductor cycle variations over multiple quarters.
Negative Factors
Top-Line Weakness
A steep trailing revenue decline undermines operating leverage and increases execution risk: persistent top-line weakness can force margin compression, reduce reinvestment capacity, and heighten sensitivity to timing shifts in multi-quarter customer capex programs, challenging near-term improvement.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash Generation & Margins
Applied’s high trailing margins and roughly $6.2B of free cash flow create durable financial flexibility. This cash generation funds R&D, capacity expansion, shareholder returns and working capital needs, enabling the company to sustain investments and weather semiconductor cycle variations over multiple quarters.
Read all positive factors
Applied Materials (AMAT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$310.60B
Dividend Yield0.69%
Average Volume (3M)6.06M
Price to Earnings (P/E)31.3
Beta (1Y)1.69
Revenue Growth2.15%
EPS Growth27.46%
CountryUS
Employees36,000
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)9.80
Shares Outstanding793,609,860
10 Day Avg. Volume5,357,687
30 Day Avg. Volume6,057,849
Financial Highlights & Ratios
PEG Ratio76.90
Price to Book (P/B)9.11
Price to Sales (P/S)6.56
P/FCF Ratio32.64
Enterprise Value/Market Cap1.05
Enterprise Value/Revenue11.55
Enterprise Value/Gross Profit23.71
Enterprise Value/Ebitda32.98
Forecast
1Y Price Target
$441.68Price Target Upside11.27% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering28
EPS Forecast (FY)11.07
Revenue Forecast (FY)$31.54B
Applied Materials Business Overview & Revenue Model
Company Description
Applied Materials, Inc. provides manufacturing equipment, services, and software to the semiconductor, display, and related industries. It operates through three segments: Semiconductor Systems, Applied Global Services, and Display and Adjacent Ma...
How the Company Makes Money
Applied Materials primarily makes money by selling capital equipment and related offerings that semiconductor and display manufacturers use to build and operate fabrication lines. Its revenue model is mainly business-to-business and is tied to cus...
Applied Materials Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlyApplied Materials Earnings Call Summary
Earnings Call Date:Feb 12, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:May 14, 2026
Earnings Call Sentiment Positive
The call conveyed a generally positive outlook driven by robust AI-related demand, a DRAM/HBM-led recovery, momentum in advanced packaging and metrology, and improving supply-chain actions. Headwinds include mixed China demand due to export controls, a slower NAND recovery, an elevated backlog with a book-to-bill near 1.0, and modest OpEx growth. Overall, positives (demand strength, technology differentiation, margin/cash generation, and operational improvements) outweigh the listed challenges.Positive Updates
Strong Top-Line and Financial Performance
Management stated Applied delivered strong revenue, margins, and cash flow in 2026Q1, with continued capital returns to shareholders via repurchases and dividends and ongoing investments in R&D and capacity.
Negative Updates
Mixed China Demand and Regulatory Impact
Demand in China is mixed by segment; mature nodes remain steady while certain leading-edge areas are impacted by export controls and regulatory restrictions, introducing regional headwinds.
Read all updates
Q1-2026 Updates
Positive
Negative
Strong Top-Line and Financial Performance
Management stated Applied delivered strong revenue, margins, and cash flow in 2026Q1, with continued capital returns to shareholders via repurchases and dividends and ongoing investments in R&D and capacity.
Read all positive updates
Company Guidance
In the 2026Q1 call Applied Materials said demand remains robust—supporting sustained WFE strength driven by AI, leading‑edge foundry‑logic and improving DRAM (HBM) versus slower NAND—and reiterated multi‑quarter visibility on HBM and capacity plans. Management reported "strong" revenue, margins and cash flow, an elevated backlog with a book‑to‑bill around unity, ongoing capital returns via dividends and steady share repurchases, and no material cancellations (only timing shifts). They expect gross margins to trend favorably as mix normalizes and productivity improves, services margins to be stable to improving, lead times to continue improving, and OpEx to grow modestly but below the pace of revenue while investing in R&D and capacity to drive long‑term operating leverage.Applied Materials Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
82
Very Positive
Cash Flow
80
Positive
| Breakdown | TTM | Oct 2025 | Oct 2024 | Oct 2023 | Oct 2022 | Oct 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 28.21B | 28.37B | 27.18B | 26.52B | 25.79B | 23.06B |
| Gross Profit | 13.75B | 13.81B | 12.90B | 12.38B | 11.99B | 10.91B |
| EBITDA | 9.89B | 9.65B | 8.79B | 8.46B | 8.26B | 7.39B |
| Net Income | 7.84B | 7.00B | 7.18B | 6.86B | 6.53B | 5.89B |
Balance Sheet | ||||||
| Total Assets | 37.64B | 36.30B | 34.41B | 30.73B | 26.73B | 25.82B |
| Cash, Cash Equivalents and Short-Term Investments | 8.51B | 8.57B | 9.47B | 6.87B | 2.58B | 5.46B |
| Total Debt | 7.19B | 7.05B | 6.61B | 6.00B | 5.83B | 5.75B |
| Total Liabilities | 15.93B | 15.88B | 15.41B | 14.38B | 14.53B | 13.58B |
| Stockholders Equity | 21.72B | 20.41B | 19.00B | 16.35B | 12.19B | 12.25B |
Cash Flow | ||||||
| Free Cash Flow | 6.19B | 5.70B | 7.49B | 7.59B | 4.61B | 4.77B |
| Operating Cash Flow | 8.72B | 7.96B | 8.68B | 8.70B | 5.40B | 5.44B |
| Investing Cash Flow | -2.67B | -2.78B | -2.33B | -1.53B | -1.36B | -1.22B |
| Financing Cash Flow | -5.12B | -5.98B | -4.47B | -3.03B | -7.04B | -4.59B |
Applied Materials Technical Analysis
Positive
396.94
Price Trends
358.35
Positive
320.49
Positive
258.99
Positive
Market Momentum
12.86
Negative
63.47
Neutral
78.83
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AMAT, the sentiment is Positive. The current price of 396.94 is above the 20-day moving average (MA) of 368.38, above the 50-day MA of 358.35, and above the 200-day MA of 258.99, indicating a bullish trend. The MACD of 12.86 indicates Negative momentum. The RSI at 63.47 is Neutral, neither overbought nor oversold. The STOCH value of 78.83 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AMAT.
Applied Materials Risk Analysis
Applied Materials disclosed 24 risk factors in its most recent earnings report. Applied Materials reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Applied Materials Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
83 Outperform | $223.81B | 40.12 | 89.07% | 0.58% | 13.43% | 28.40% | |
81 Outperform | $530.06B | 39.94 | 51.97% | 0.63% | 18.56% | 26.42% | |
81 Outperform | $323.36B | 34.22 | 65.79% | 0.56% | 26.53% | 47.73% | |
72 Outperform | $310.60B | 31.26 | 38.90% | 0.69% | 2.15% | 27.46% | |
71 Outperform | $52.82B | 27.09 | 29.72% | 0.24% | 30.33% | 51.65% | |
68 Neutral | $72.86B | 26.48 | 12.81% | 2.29% | 15.55% | 43.35% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
AMAT
Applied Materials
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157.72%
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Applied Materials Corporate Events
Executive/Board ChangesShareholder Meetings
Applied Materials Shareholders Reaffirm Board, Pay and Auditor
Positive
Mar 13, 2026
At its Annual Meeting of Shareholders held on March 12, 2026, Applied Materials, Inc. saw all ten board nominees, including CEO Gary E. Dickerson, re-elected to one-year terms, signaling broad investor support for the company’s current gover...
Legal ProceedingsRegulatory Filings and Compliance
Applied Materials Resolves U.S. Export Compliance Allegations
Negative
Feb 12, 2026
On February 11, 2026, Applied Materials announced that it had reached a civil settlement with the U.S. Department of Commerce’s Bureau of Industry and Security, resolving allegations that certain customer shipments to China between November ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.