Applied Materials (NASDAQ:AMAT) Shares Down 7.8% – Time to Sell?

Applied Materials, Inc. (NASDAQ:AMAT) shares were down 7.8% during mid-day trading on Tuesday . The company traded as low as $467.01 and last traded at $476.46. Approximately 9,812,773 shares were traded during trading, an increase of 19% from the average session volume of 8,264,086 shares. The stock had previously closed at $516.89.

Key Stories Impacting Applied Materials

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

• Positive Sentiment: Applied Materials continues to benefit from AI-driven wafer-fabrication spending. A Columbia Threadneedle technology-fund letter cited the company’s exposure to semiconductor capital spending and AI-related equipment demand as contributors to its investment performance. Applied Materials Rose on AI-Driven Wafer Fabrication Spending
• Positive Sentiment: Analyst expectations remain favorable ahead of earnings: Applied Materials is among semiconductor stocks with a positive Earnings ESP, supported by AI, cloud-computing and storage demand. Its latest reported quarter also exceeded consensus estimates for earnings and revenue, while management provided third-quarter fiscal 2026 EPS guidance of $3.16 to $3.56. 3 Semiconductor Stocks Likely to Outpace Q2 Earnings Estimates
• Positive Sentiment: Several Wall Street analysts have continued issuing upgrades as memory-chip demand improves, providing a counterpoint to hedge-fund manager Michael Burry’s reported bearish position on the semiconductor sector. Applied Materials Stock Keeps Winning Upgrades
• Neutral Sentiment: Applied Materials’ valuation and strong recent appreciation leave the stock sensitive to profit-taking and any signs that semiconductor-capital-spending growth is slowing.
• Negative Sentiment: U.S. chip stocks extended losses as investors reassessed the financing and sustainability of the AI infrastructure boom, while renewed competition from China increased pressure across the sector. U.S. Chip Stocks Extend Losses on AI Financing and China Competition Fears
• Negative Sentiment: Reports that China is mass-producing domestic immersion DUV lithography equipment raise longer-term risks for Applied Materials, potentially reducing demand from Chinese fabs and limiting the company’s ability to benefit from AI-related investment there amid export controls. China’s Domestic Immersion DUV Push at Applied Materials

Analyst Ratings Changes

Several analysts have recently commented on the stock. Wall Street Zen upgraded shares of Applied Materials from a “hold” rating to a “buy” rating in a research report on Saturday, May 23rd. Zacks Research upgraded Applied Materials from a “hold” rating to a “strong-buy” rating in a research report on Wednesday, July 1st. JPMorgan Chase & Co. upped their target price on Applied Materials from $400.00 to $515.00 and gave the company an “overweight” rating in a research note on Friday, May 15th. TD Cowen increased their target price on Applied Materials from $525.00 to $700.00 and gave the company a “buy” rating in a report on Thursday, July 9th. Finally, Stifel Nicolaus raised their price target on Applied Materials from $530.00 to $650.00 and gave the stock a “buy” rating in a research report on Friday, July 10th. One analyst has rated the stock with a Strong Buy rating, twenty-seven have assigned a Buy rating and six have issued a Hold rating to the company’s stock. According to MarketBeat, the stock currently has a consensus rating of “Moderate Buy” and a consensus price target of $599.19.

Applied Materials Stock Performance

The company has a market capitalization of $378.29 billion, a PE ratio of 44.74, a price-to-earnings-growth ratio of 1.36 and a beta of 1.57. The stock’s fifty day simple moving average is $546.28 and its 200-day simple moving average is $425.63. The company has a debt-to-equity ratio of 0.22, a quick ratio of 1.80 and a current ratio of 2.51.

Applied Materials (NASDAQ:AMAT) last issued its quarterly earnings results on Thursday, May 14th. The manufacturing equipment provider reported $2.86 EPS for the quarter, topping analysts’ consensus estimates of $2.68 by $0.18. The business had revenue of $7.91 billion during the quarter, compared to the consensus estimate of $7.68 billion. Applied Materials had a net margin of 29.31% and a return on equity of 36.97%. The company’s quarterly revenue was up 11.4% compared to the same quarter last year. During the same period in the previous year, the firm posted $2.39 earnings per share. Applied Materials has set its Q3 2026 guidance at 3.160-3.560 EPS. As a group, equities analysts predict that Applied Materials, Inc. will post 12.14 earnings per share for the current year.

Applied Materials Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Thursday, September 10th. Investors of record on Thursday, August 20th will be given a dividend of $0.53 per share. The ex-dividend date is Thursday, August 20th. This represents a $2.12 dividend on an annualized basis and a yield of 0.4%. Applied Materials’s dividend payout ratio (DPR) is 19.91%.

Insider Transactions at Applied Materials

In other Applied Materials news, SVP Omkaram Nalamasu sold 24,263 shares of the business’s stock in a transaction on Tuesday, June 16th. The stock was sold at an average price of $593.43, for a total value of $14,398,392.09. Following the completion of the transaction, the senior vice president directly owned 146,916 shares in the company, valued at approximately $87,184,361.88. The trade was a 14.17% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is accessible through this link. Also, SVP Timothy M. Deane sold 8,621 shares of the stock in a transaction on Monday, June 15th. The stock was sold at an average price of $590.76, for a total value of $5,092,941.96. Following the transaction, the senior vice president directly owned 134,631 shares in the company, valued at approximately $79,534,609.56. This represents a 6.02% decrease in their position. The SEC filing for this sale provides additional information. Insiders sold 278,088 shares of company stock worth $169,654,805 in the last three months. 0.30% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Applied Materials

Several institutional investors have recently added to or reduced their stakes in the business. Cornerstone Financial Management LLC acquired a new stake in Applied Materials in the 4th quarter worth about $25,000. Wilkerson Advisory Group LLC acquired a new position in shares of Applied Materials during the 4th quarter valued at about $26,000. Financial Freedom LLC acquired a new position in shares of Applied Materials during the 1st quarter valued at about $28,000. Highline Wealth Partners LLC increased its stake in shares of Applied Materials by 48.7% during the 4th quarter. Highline Wealth Partners LLC now owns 116 shares of the manufacturing equipment provider’s stock valued at $30,000 after acquiring an additional 38 shares during the last quarter. Finally, Joseph Group Capital Management purchased a new position in shares of Applied Materials during the 4th quarter worth about $31,000. 80.56% of the stock is currently owned by institutional investors and hedge funds.

About Applied Materials

Applied Materials, Inc is a U.S.-based supplier of equipment, services and software used to manufacture semiconductor chips, flat panel displays and other advanced materials. Headquartered in Santa Clara, California, the company designs and sells capital equipment and related technologies that enable production of integrated circuits, display panels and materials used across the electronics supply chain.

Applied Materials’ offerings include process equipment and factory software that support critical steps in device fabrication, such as deposition, etch, implantation, inspection and metrology, as well as systems for packaging and advanced heterogeneous integration.