Applied Materials Outlook - Mixed Signals Amid Volatility

Market Snapshot

Takeaway: Applied Materials (AMAT.O) is showing a mixed market outlook, with a current price rise of 12.57% but weak technical indicators suggesting caution. Investors should tread carefully with the stock's uncertain momentum.

News Highlights

Recent news from the semiconductor sector highlights both global supply chain concerns and sustainability efforts. Here are the key updates:

• McKinsey Report on Tariffs: A new analysis from McKinsey explores how U.S. tariffs could impact the semiconductor industry, emphasizing the uncertainty in global supply chains.
• Japan-U.S. Cooperation Plans: Japan is reportedly preparing proposals to collaborate with the U.S. on rare earths and semiconductors, a move potentially aimed at countering China's dominance in the sector.
• ETF Outflows: The U.S. Semiconductors ETF (SOXX) faced a $750 million net outflow in May 2025, signaling cautious investor sentiment in the broader industry.

Analyst Views & Fundamentals

Analyst sentiment for AMAT.O is mixed. The simple average rating is 3.00, while the performance-weighted rating is 1.95, reflecting a pessimistic outlook from the market. Analysts are largely neutral or underperforming, with only one recent rating from Mizuho.

Notably, the current price is rising despite these weak ratings, suggesting a misalignment between market expectations and price movement. This divergence may indicate a short-term anomaly or a deeper issue in the fundamentals.

Fundamental Highlights:

• EV/EBIT: 81.18 (Internal diagnostic score: 3.00)
• Accounts Receivable Turnover Ratio: 2.50 (Score: 2.00)
• Diluted Earnings Per Share (YoY Growth %): -8.72% (Score: 3.00)
• Net Profit Attributable to Parent Shareholders (YoY Growth %): -11.20% (Score: 3.00)
• Net Cash Flow from Operating Activities (YoY Growth %): -32.85% (Score: 2.00)
• Cash-MV: -0.46% (Score: 3.00)

Money-Flow Trends

Big-money and institutional investors are showing more confidence in AMAT.O than retail traders. The overall inflow ratio is 51.95%, with extra-large inflow ratio at 54.79% and block inflow ratio at 52.40%. However, smaller investors are less optimistic, with small inflow ratio at 49.71%.

While the overall trend is positive, medium and small flows are negative, indicating potential uncertainty among smaller investors. This suggests a tug-of-war between big and small players in the short-term.

Key Technical Signals

Technical indicators for AMAT.O are largely bearish, with only one bullish signal. Here’s a breakdown of the key signals:

• WR Overbought: Internal diagnostic score: 2.17 – Neutral to bearish; suggests overbought conditions could lead to a pullback.
• MACD Golden Cross: Score: 1.00 – Strongly bearish; historically, this pattern has led to an average return of -1.12%.
• Marubozu White: Score: 1.00 – Biased bearish; a large white candle showing strong selling pressure.
• Dividend Payable Date: Score: 8.13 – Strongly bullish; often triggers buying interest from income-focused investors.

Recent Chart Patterns:

• 2025-09-12: WR Overbought and Marubozu White
• 2025-09-11: WR Overbought, Dividend Payable Date, and Marubozu White
• 2025-09-16: WR Overbought
• 2025-09-15: WR Overbought
• 2025-09-08: MACD Golden Cross

These signals suggest a weak technical outlook, with bearish momentum dominating the recent chart activity. Investors are advised to avoid taking new positions or consider protective strategies in light of the volatility and unclear trend.

Conclusion

Applied Materials is at a crossroads: while fundamentals remain largely stable, technical and sentiment indicators point to caution. The technical score of 3.08 (out of 10) and weak analyst ratings signal a period of uncertainty. Given the bearish technical signals and divergent market expectations, investors should consider waiting for a clearer breakout or a pullback before entering the stock.