Applied Materials Outlook - Technical Weakness Persists Amid Mixed Fundamental Signals

Market Snapshot

Headline takeaway: Despite mixed fundamentals, technical signals remain bearish, suggesting investors should proceed with caution — internal diagnostic score: 3.72.

News Highlights

• McKinsey weighs in on tariffs and chip supply chains: The report suggests ongoing regulatory uncertainty could impact Applied Materials' business, especially in the semiconductor supply chain, where AMAT plays a key role.
• Japan proposes cooperation on rare earths and semiconductors: This development may indirectly benefit AMAT if global supply chain diversification efforts accelerate and demand for materials and equipment rises.
• SOXX ETF sees $750M outflow: The outflow reflects a broader cooling in the semiconductor sector, which could pressure AMAT's price as sector sentiment wanes.

Analyst Views & Fundamentals

Average rating score: 3.00 (simple mean) | Weighted rating score: 2.92 | Rating consistency: High — all recent ratings are neutral.

The average and weighted ratings are slightly below the current price trend (8.48% rise), showing a potential mismatch between market expectations and actual performance. This divergence suggests caution for investors expecting strong momentum to continue.

Key Fundamental Factors

• EV/EBIT: 81.18 — internal diagnostic score: 3.00
• Net profit attributable to parent company shareholders / Net profit: 100.00% — internal diagnostic score: 1.00
• Accounts receivable turnover ratio: 2.50 — internal diagnostic score: 2.00
• Diluted earnings per share (YoY growth rate %): -8.72% — internal diagnostic score: 3.00
• Net profit attributable to parent company shareholders (YoY growth rate %): -11.20% — internal diagnostic score: 3.00
• Cash-MV: -0.46 — internal diagnostic score: 3.00

These mixed fundamental metrics point to moderate earnings resilience but weak cash flow growth and declining net profit, which could signal underlying operational strain.

Money-Flow Trends

Big money is still cautious on AMAT, as fund flows across all sizes (small, medium, large, extra-large) are negative. The overall fund flow ratio is 0.48, with block flows also negative, indicating a lack of institutional confidence at this time.

• Small_inflow_ratio: 0.49 — negative trend
• Large_inflow_ratio: 0.47 — negative trend
• Extra-large_inflow_ratio: 0.48 — negative trend

With internal diagnostic score of 7.72 (good), the flow of funds appears to be diverging from price performance, which may hint at short-term volatility or a shift in market sentiment.

Key Technical Signals

Technical analysis is bearish: 5 out of 7 indicators are negative, with just 2 bullish signals and none neutral. The overall technical score is 3.72, reflecting a weak trend with mixed momentum.

Recent Indicator Highlights (Internal diagnostic scores 0-10):

• WR Overbought (2.15): Neutral rise, but historically shows an average return of -0.98% with a 47.62% win rate.
• MACD Golden Cross (1.00): Biased bearish, with a 30% win rate and -1.12% average return.
• Marubozu White (1.00): Biased bearish, historically underperforming with -3.34% average return and 25% win rate.
• Bullish Engulfing (8.10): Strong bullish bias, with 83.33% win rate and 1.80% average return.
• Dividend Payable Date (7.81): Bullish bias, with 100% win rate and 1.41% average return.

Recent Chart Patterns (Last 5 Days):

• 2025-09-12: WR Overbought
• 2025-09-11: WR Overbought, Dividend Payable Date, Marubozu White
• 2025-09-04: Bullish Engulfing
• 2025-09-08: MACD Golden Cross

The mix of bearish and bullish signals suggests a volatile but directionless market. With more bearish indicators and weak momentum, the technical outlook remains cautious.

Conclusion

Investors should consider waiting for a pull-back before initiating new positions in AMAT. While fundamentals show mixed resilience, technical indicators are bearish and money flows are negative. The combination of these signals — especially the low internal diagnostic score of 3.72 — suggests that now is not the ideal time to chase the stock. A clearer trend and stronger institutional confidence may be necessary before making a move.