Mizuho Raises Applied Materials PT to $220, Maintains Outperform Rating

Mizuho Raises Applied Materials PT to $220, Maintains Outperform Rating

Mizuho Financial Group has increased its price target for Applied Materials (NASDAQ:AMAT) to $220, maintaining its Outperform rating. The upgrade reflects Mizuho's positive outlook on the semiconductor equipment maker's position in the market, particularly its ability to benefit from the ongoing shift towards 3D architectures [1].

Mizuho's analyst, Vijay Rakesh, noted that Applied Materials' established portfolio of critical equipment tools, which generates approximately 30% of the company's systems revenue from integrated solutions, positions it well to capitalize on the industry's evolving demands. The analyst also acknowledged the intense competition from Chinese manufacturers but expects their market share gains to be primarily localized [1].

This upgrade comes amidst a series of positive developments for Applied Materials. The company 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. Additionally, 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 [2].

However, some analysts have expressed concerns over market share losses in the Physical Vapor Deposition segment and vulnerability to localization efforts in China. Redburn-Atlantic downgraded the stock to neutral, while TD Cowen maintained a Buy rating but reduced the price target to $220, pointing to strong product momentum and pricing power as positive factors [2].

Despite these varying views, Mizuho's upgrade underscores the investment bank's confidence in Applied Materials' ability to navigate the challenges and capitalize on the opportunities in the semiconductor equipment market.

References:
[1] https://www.streetinsider.com/news.php?classic=1&id=25045242
[2] https://www.investing.com/news/analyst-ratings/goldman-sachs-initiates-applied-materials-stock-with-buy-rating-225-target-93CH-4129458