Applied Materials (NASDAQ:AMAT) Stock Jumps 2% – Here’s Why

Applied Materials, Inc. (NASDAQ:AMAT) was up 2% on Friday. The stock traded as high as $547.25 and last traded at $540.04. Approximately 5,696,993 shares traded hands during trading, a decline of 28% from the average daily volume of 7,949,775 shares. The stock had previously closed at $529.30.

More Applied Materials News

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

• Positive Sentiment: Expanded AI packaging partnership: Besi is joining Applied Materials’ EPIC Center as an innovation partner. The collaboration will target 3D integrated-circuit scaling, logic and memory integration, photonics, hybrid bonding, thermo-compression bonding, and die-on-wafer, die-on-die, and die-on-panel architectures. The agreement strengthens Applied’s exposure to the growing AI infrastructure buildout. Applied Materials and Besi Expand Strategic Partnership to Advance Next-Generation Packaging for AI Scaling
• Positive Sentiment: Longer growth runway: Investor commentary highlights continued AI-compute expansion and memory shortages as potential drivers for Applied Materials’ semiconductor-equipment demand. The company’s broad materials-engineering portfolio could benefit as chipmakers increase capacity and adopt more complex architectures. AI Compute Expansion and Memory Shortages Extend Applied Materials’ Growth Runway
• Positive Sentiment: Analyst valuation support: Applied Materials has an average price target of $629.38, suggesting analysts see additional upside from the current trading level. Applied Materials Stock Has Average Target Price of $629.38
• Neutral Sentiment: Investment comparisons remain mixed: Recent analysis portrays Applied Materials as offering broader AI-driven growth at a lower valuation than some semiconductor-equipment alternatives, while ASML provides stronger demand visibility. Another comparison weighs Applied Materials against Taiwan Semiconductor Manufacturing, underscoring that investors are choosing between equipment exposure and foundry scale.
• Negative Sentiment: Valuation and concentration risks: Commentary cautions that investors are heavily exposed to semiconductor-tool sales, which accounted for roughly 77% of fiscal third-quarter revenue. With the stock trading at a premium valuation, any slowdown in equipment spending or failure to convert AI demand into orders could pressure the shares. What Are Applied Materials Stock Investors Overlooking?

Wall Street Analyst Weigh In

Several equities research analysts have recently issued reports on the stock. Morgan Stanley lowered their price objective on shares of Applied Materials from $642.00 to $563.00 and set an “equal weight” rating on the stock in a research note on Monday. Craig Hallum increased their price target on shares of Applied Materials from $530.00 to $585.00 and gave the company a “buy” rating in a report on Friday, August 14th. HSBC dropped their price objective on shares of Applied Materials from $683.00 to $641.00 and set a “buy” rating on the stock in a report on Friday, August 14th. Mizuho reduced their target price on shares of Applied Materials from $650.00 to $590.00 and set an “outperform” rating for the company in a research note on Tuesday, August 25th. Finally, Susquehanna increased their target price on shares of Applied Materials from $575.00 to $900.00 and gave the company a “positive” rating in a research note on Tuesday, June 30th. One analyst has rated the stock with a Strong Buy rating, thirty have given a Buy rating and eight have given a Hold rating to the company. According to MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and an average target price of $629.38.

Applied Materials Price Performance

The company’s 50 day moving average price is $485.40 and its 200 day moving average price is $475.44. 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 company has a market cap of $428.58 billion, a price-to-earnings ratio of 46.56, a P/E/G ratio of 1.42 and a beta of 1.59.

Applied Materials (NASDAQ:AMAT) last announced its quarterly earnings results on Thursday, August 13th. The manufacturing equipment provider reported $3.50 earnings per share (EPS) for the quarter, beating the consensus estimate of $3.40 by $0.10. The firm 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%. The firm’s quarterly revenue was up 24.8% on a year-over-year basis. During the same period last year, the firm posted $2.48 EPS. Applied Materials has set its Q4 2026 guidance at 3.820-4.220 EPS. On average, equities research analysts predict that Applied Materials, Inc. will post 12.79 earnings per share for the current fiscal year.

Applied Materials Announces Dividend

The firm 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 dividend on an annualized basis and a yield of 0.4%. The ex-dividend date of this dividend is Thursday, November 19th. Applied Materials’s dividend payout ratio (DPR) is currently 18.28%.

Insiders Place Their Bets

In related news, CFO Brice Hill sold 7,500 shares of the business’s stock in a transaction that occurred on Tuesday, August 25th. The shares were 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 position. The transaction was disclosed in a document filed with the SEC, which is available at the SEC website. Also, Director Judy Bruner sold 1,000 shares of the business’s stock in a transaction 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 SEC filing for this sale provides additional information. Company insiders own 0.30% of the company’s stock.

Institutional Investors Weigh In On Applied Materials

A number of institutional investors and hedge funds have recently modified their holdings of AMAT. BlackRock Inc. raised its position in shares of Applied Materials by 1.6% during 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 acquiring an additional 1,237,685 shares during 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 purchasing an additional 32,018,892 shares during the last quarter. Capital Research Global Investors grew its stake in shares of Applied Materials by 119.8% during the fourth quarter. Capital Research Global Investors now owns 32,707,049 shares of the manufacturing equipment provider’s stock worth $8,405,458,000 after purchasing an additional 17,829,377 shares during the period. Amundi grew its stake in shares of Applied Materials by 19.0% during the second quarter. Amundi now owns 7,808,207 shares of the manufacturing equipment provider’s stock worth $5,645,344,000 after purchasing an additional 1,246,876 shares during the period. Finally, Van ECK Associates Corp increased its holdings 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 purchasing an additional 1,073,879 shares during the last quarter. 80.56% of the stock is 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.