Applied Materials Sees Mixed Performance Amid Market Challenges

With a market cap of $126.6 billion, Applied Materials, Inc. (AMAT) provides manufacturing equipment, services, and software for the semiconductor, display, and related industries. The company is headquartered in Santa Clara, California, and operates through three segments: Semiconductor Systems, Applied Global Services, and Display.

Stock Performance Overview

Over the past year, AMAT has struggled compared to the broader market and the iShares Semiconductor ETF (SOXX). The company’s stock prices have dropped 24.8% in the last 52 weeks and are down 4.1% year-to-date. In contrast, the S&P 500 Index ($SPX) saw a 9.2% return over the same period while declining 3.7% year-to-date.

Narrowing the focus, AMAT’s performance is also behind SOXX’s 12.4% decline over the past year, though it has outperformed SOXX’s 11% drop this year.

Recent Earnings Report

Shares of AMAT rose 1.9% following the announcement of its Q1 earnings on February 13. The company reported a 6.8% year-over-year increase in net revenues, reaching $7.2 billion, which exceeded analyst expectations. Additionally, adjusted earnings per share (EPS) grew 11.7% year-over-year to $2.38, surpassing consensus estimates by 4.4%. The company also noted improved margins, with an adjusted gross margin expanding to 48.9% and an adjusted operating margin increasing to 30.6%.

Analyst Expectations and Ratings

For the fiscal year ending in October 2025, analysts forecast an 8.2% rise in AMAT’s EPS to $9.36. Impressively, the company has exceeded analysts’ consensus estimates in each of the past four quarters.

The consensus rating among 33 analysts is a “Moderate Buy,” which consists of 22 “Strong Buy” ratings, two “Moderate Buys,” eight “Holds,” and one “Strong Sell.” This rating is comparatively more positive than two months ago, when only 20 analysts classified it as a “Strong Buy.”

Price Targets and Market Outlook

On April 22, Barclays PLC (BCS) analyst Thomas O’Malley maintained a “Hold” rating on Applied Materials, reducing the price target from $190 to $160. Currently, AMAT’s mean price target of $203.74 suggests a potential upside of 30.6% from current market prices, while the Street-high target of $250 indicates a robust 60.3% upside potential.

On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.

The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.