Applied Materials: Goldman Sachs initiates Buy rating with $225 PT.

Applied Materials: Goldman Sachs initiates Buy rating with $225 PT.

Goldman Sachs has initiated coverage on Applied Materials (NASDAQ:AMAT) with a Buy rating and a price target of $225.00, as reported by Investing.com [1]. The semiconductor equipment maker, with a market capitalization of $156.8 billion, benefits from the industry's shift toward 3D architectures, which requires more intensive etching and deposition processes. Applied Materials' portfolio of critical equipment tools, generating approximately 30% of its systems revenue from integrated solutions, positions it favorably in the market.

While acknowledging intense competition from Chinese manufacturers, Goldman Sachs expects their market share gains to be limited to local Chinese demand. The $225 price target reflects the investment bank's positive outlook on Applied Materials' position in the semiconductor equipment market.

In other recent news, Applied Materials reported a quarterly dividend increase to $0.46 per share, marking a 15% rise from the previous dividend and continuing an eight-year trend of dividend growth. The company returned nearly $2 billion to shareholders through dividends and share repurchases in the second quarter of fiscal 2025, with $15.9 billion remaining in its share repurchase authorization.

Morgan Stanley upgraded Applied Materials' stock to equalweight, citing revised revenue and EPS estimates of $28.6 billion and $9.36 for fiscal year 2025, respectively. However, Redburn-Atlantic downgraded the stock to neutral, expressing concerns over market share losses in its Physical Vapor Deposition segment and vulnerability to localization efforts in China. TD Cowen maintained a Buy rating but reduced the price target to $220, pointing to strong product momentum and pricing power as positive factors. Cantor Fitzgerald upheld an Overweight rating with a $200 price target, noting that Applied Materials' EPS exceeded expectations despite slight revenue misses.

References:
[1] https://in.investing.com/news/analyst-ratings/goldman-sachs-initiates-applied-materials-stock-with-buy-rating-225-target-93CH-4906423
[2] https://www.investing.com/news/analyst-ratings/goldman-sachs-initiates-applied-materials-stock-with-buy-rating-225-target-93CH-4129458