Applied Materials (NASDAQ:AMAT) Shares Up 2% – Should You Buy?

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

Key Stories Impacting Applied Materials

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 Analysts Forecast Growth

Several research analysts recently weighed in on the stock. Berenberg Bank lifted their price objective on shares of Applied Materials from $575.00 to $675.00 and gave the stock a “buy” rating in a research note on Monday, August 17th. Raymond James Financial set a $650.00 target price on shares of Applied Materials in a report on Wednesday, June 10th. Deutsche Bank Aktiengesellschaft reissued a “buy” rating and set a $605.00 price target (down from $680.00) on shares of Applied Materials in a research report on Friday, August 14th. Zacks Research raised shares of Applied Materials from a “hold” rating to a “strong-buy” rating in a report on Wednesday, July 1st. Finally, JPMorgan Chase & Co. upped their price objective on shares of Applied Materials from $515.00 to $660.00 and gave the company an “overweight” rating in a research report on Friday, August 14th. One investment analyst has rated the stock with a Strong Buy rating, thirty have assigned a Buy rating and eight have assigned a Hold rating to the company. According to data from MarketBeat.com, Applied Materials currently has a consensus rating of “Moderate Buy” and an average price target of $629.38.

Applied Materials Trading Up 2.0%

The company has a quick ratio of 1.79, a current ratio of 2.42 and a debt-to-equity ratio of 0.20. The company has a market capitalization of $428.58 billion, a P/E ratio of 46.56, a price-to-earnings-growth ratio of 1.42 and a beta of 1.59. The business has a fifty day moving average price of $485.40 and a 200 day moving average price of $475.44.

Applied Materials (NASDAQ:AMAT) last posted its quarterly earnings data 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. Applied Materials had a return on equity of 38.02% and a net margin of 30.05%.The business had revenue of $9.12 billion during the quarter, compared to the consensus estimate of $8.99 billion. During the same period last year, the company earned $2.48 earnings per share. Applied Materials’s quarterly revenue was up 24.8% on a year-over-year basis. Applied Materials has set its Q4 2026 guidance at 3.820-4.220 EPS. On average, analysts expect that Applied Materials, Inc. will post 12.79 earnings per share for the current fiscal year.

Applied Materials Dividend Announcement

The firm also recently declared a quarterly dividend, which will be paid on Thursday, December 10th. Stockholders of record on Thursday, November 19th will be paid a dividend of $0.53 per share. This represents a $2.12 annualized dividend and a dividend 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%.

Insider Buying and Selling

In related news, Director Judy Bruner sold 1,000 shares of the firm’s stock in a transaction on Tuesday, September 8th. The shares were sold at an average price of $465.00, for a total value of $465,000.00. Following the completion of the transaction, the director owned 25,544 shares of the company’s stock, valued at approximately $11,877,960. This trade represents a 3.77% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, CFO Brice Hill sold 7,500 shares of the business’s stock in a transaction dated Tuesday, August 25th. The stock was sold at an average price of $479.25, for a total transaction of $3,594,375.00. Following the sale, the chief financial officer directly owned 128,613 shares in the company, valued at $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. 0.30% of the stock is owned by company insiders.

Institutional Trading of Applied Materials

A number of hedge funds and other institutional investors have recently modified their holdings of AMAT. State Street Corp raised its stake in shares of Applied Materials by 85.4% during 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 in the last quarter. Capital Research Global Investors lifted its stake in Applied Materials by 119.8% in the fourth quarter. Capital Research Global Investors now owns 32,707,049 shares of the manufacturing equipment provider’s stock valued at $8,405,458,000 after acquiring an additional 17,829,377 shares during the last quarter. Bank of America Corp DE acquired a new stake in Applied Materials in the second quarter valued at $5,252,863,000. Auto Owners Insurance Co grew its position in shares of Applied Materials by 25,824.4% in the 4th quarter. Auto Owners Insurance Co now owns 3,370,167 shares of the manufacturing equipment provider’s stock valued at $86,610,000 after acquiring an additional 3,357,167 shares during the period. Finally, Jupiter Topco LLC bought a new position in shares of Applied Materials in the 2nd quarter valued at about $1,512,287,000. Institutional investors and hedge funds own 80.56% of the company’s stock.

Applied Materials Company Profile

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.