Stock Analysis | Applied Materials Outlook - A Bearish Signal Amid Mixed Fundamentals

Market Snapshot

Headline: Technical indicators show a strong bearish bias with 5 bearish signals vs 1 bullish signal. Stance: Bearish.

News Highlights

• McKinsey weighs in on tariffs and chip supply chains - Research from McKinsey & Co explores the impact of US tariffs policy on the semiconductors sector. This could influence investor sentiment toward AMAT in the long term.
• Japan to Offer U.S. Proposals for Cooperation on Rare Earths, Semiconductors - The government is arranging to propose greater cooperation between Japan and the U.S. on semiconductors, which might affect global supply chains and AMAT's operations.
• Understanding indie Semiconductor's Financial Performance - indie Semiconductor's negative ROIC indicates it is not generating returns above its cost of capital, which could indirectly affect AMAT's industry positioning.

Analyst Views & Fundamentals

Average Rating Score (Simple Mean): 3.71

Weighted Rating Score (Performance-Weighted): 1.60

Ratings Consistency: There are differences among analyst ratings.

Analyst vs. Price Trend: Current price trends indicate a fall of -11.52%, and the weighted expectations match the bearish sentiment.

Key Fundamental Factors:

• Net cash flow from operating activities per share (YoY growth rate %): -5.82% (Internal diagnostic score: 1.00)
• Net profit attributable to parent company shareholders / Net profit %: 100.00% (Internal diagnostic score: 1.00)
• Gross profit margin (GPM): 49.08% (Internal diagnostic score: 2.00)
• Total profit (YoY growth rate %): 3.35% (Internal diagnostic score: 2.00)
• Cash-UP (Cash to Market Value): 60.96% (Internal diagnostic score: 3.00)
• CFOA (Cash flow from operating activities): 4.67% (Internal diagnostic score: 2.00)
• GPOA (Gross profit operating activities): 10.36% (Internal diagnostic score: 2.00)
• Interest coverage ratio (EBIT / Interest expense): 34.64% (Internal diagnostic score: 2.00)
• Net profit attributable to parent company shareholders (YoY growth rate %): -11.20% (Internal diagnostic score: 3.00)
• Cash-MV (Cash to Market Value): -46.69% (Internal diagnostic score: 0.00)

Money-Flow Trends

Big-money investors are currently showing a negative trend with an inflow ratio of 49.96%. This suggests that institutional investors are cautious about the stock's near-term prospects.

On the retail side, the inflow ratio is 49.90%, also pointing to a negative trend. Small investors are not showing significant interest in AMAT at the moment, which reinforces the bearish technical outlook.

Key Technical Signals

Our internal diagnostic scores highlight the following key indicators:

• RSI Oversold: Strong bullish with a score of 8.10. This suggests a potential rebound may be on the horizon.
• Bearish Engulfing: Biased bearish with a score of 1.19. This pattern is a warning sign for short-term traders.
• MACD Golden Cross: Biased bearish with a score of 1.00. The golden cross is not behaving as expected, indicating further weakness.
• Earnings Release Date: Biased bearish with a score of 1.00. This suggests the upcoming earnings could be a negative surprise.

Recent Chart Patterns:

• 2025-08-15: WR Oversold, MACD Death Cross, Inverted Hammer, RSI Oversold
• 2025-08-14: WR Overbought, MACD Golden Cross, Earnings Release Date
• 2025-07-29: Bearish Engulfing

Technical Insight Summary: Technical indicators show a weak state, with bearish signals dominating (5 bearish vs 1 bullish). Investors should be cautious and consider avoiding the stock at this time.

Conclusion

Applied Materials is facing a challenging period, with bearish signals dominating the technical landscape and mixed fundamentals. While the RSI Oversold condition may indicate a potential rebound, the overall trend is weak. Investors are advised to consider waiting for a pull-back before entering the stock. Watch the upcoming earnings release and the broader market reaction to key industry developments for further guidance.