Applied Materials Gains Boost from Bernstein's New Buy Rating

Applied Materials (AMAT) has a Strong Buy consensus rating from analysts, with a price target of $205.45, a 6.85% upside from current levels. Bernstein analyst Qingyuan Lin maintains a Buy rating and a $210 price target. AMAT's market cap is $152.8B, and corporate insider sentiment is negative, with 38 insiders selling shares in the past quarter.

Applied Materials (AMAT) has garnered a strong consensus rating from analysts, with a price target of $205.45, a 6.85% upside from current levels. Bernstein analyst Qingyuan Lin maintains a Buy rating with a price target of $210. The stock's market capitalization stands at $152.8 billion, while corporate insider sentiment is negative, with 38 insiders selling shares in the past quarter [1].

Analysts are bullish on AMAT's earnings outlook, with the Zacks Consensus Estimate projecting quarterly earnings per share (EPS) of $2.34, a 10.38% increase compared to the same quarter of the previous year. For the fiscal year ending October 2025, the Zacks Consensus Estimate is $9.47 per share, unchanged from the year-ago reported number. This upward trend in earnings estimates has led to a Zacks Rank of #2 (Buy) for AMAT, placing it in the top 20% of the Zacks-covered stocks in terms of estimate revisions [2].

The semiconductor industry, of which AMAT is a key player, is experiencing a significant demand restart, particularly in foundries. The U.S. green light for AI chip exports to China is also seen as a positive catalyst across the supply chain. AMAT's strong position in the semiconductor value chain, particularly in deposition, etching, and CMP, makes it a critical supplier for companies like TSMC, Samsung, Intel, and Micron. Seventy-five percent of AMAT's revenue comes from its Semiconductor Systems segment, which includes these process machines, while the remaining 25% comes from services, upgrades, and maintenance [3].

Despite the positive outlook, investors should be cautious about the negative insider sentiment. The company's strong fundamentals and the market's focus on other stocks may be undervaluing AMAT. However, the recent guidance and order restart in foundries indicate a potential recovery in demand. Analysts' positive outlook and the company's critical role in the semiconductor industry suggest that AMAT could be a solid investment opportunity for the near term.

References:
[1] https://finance.yahoo.com/news/applied-materials-amat-laps-stock-214504145.html
[2] https://finance.yahoo.com/news/applied-materials-amat-upgraded-buy-160003827.html
[3] https://seekingalpha.com/article/4802625-applied-materials-everyone-looks-at-nvidia-but-chips-must-be-built-first