Applied Materials, Inc.(AMAT) - Stock detail

Applied Materials, Inc.

US
AMAT
Applied Materials, Inc.(Listing date: 01/06/1978)

Applied Materials, Inc., founded in 1967, is a global company incorporated in Delaware with extensive capabilities in materials engineering. The company provides manufacturing equipment, services and software for the semiconductor, display and related industries. Leveraging its diverse technological capabilities, the company's products and services can enhance device performance, yield and cost. Its customers include manufacturers of semiconductor chips, liquid crystal and organic light-emitting diode (OLED) displays, and other electronic devices.

AI Value AnalystHold
Overall Rating6.3/10
Generated at:2026-03-06 16:41:02
Analysis based on 5 financial reports from 2024-07-28 to 2025-07-27. Data includes quarterly financial metrics, valuation multiples, and fundamental indicators. Analysis completed as of 2026-03-07 with comprehensive coverage of financial condition, profitability, and valuation metrics.
Overview

Applied Materials is a leading global provider of manufacturing equipment, services, and software to semiconductor, display, and solar photovoltaic industries. The company demonstrates strong financial condition with good liquidity, moderate leverage, and high profitability metrics, though facing cyclical industry dynamics and near-term earnings volatility.

Valuation
5/10
Profitability
7/10
Financial health
7/10
Operation Advice
  • Hold position at current price of $324.74, which represents fair valuation.
  • Consider monitoring industry cycles and quarterly guidance for potential entry/exit timing.
  • Base case target range is $320-$360, with bull case reaching $380-$420 if semiconductor capex cycles outperform.

Valuation

P/E TTM
35.08
P/E LYR
38.72
P/B MRQ
12.66
P/S TTM
--
AI Analysis
  • AMAT shows elevated valuation multiples (P/E 35.08x, P/B 12.66x, P/S 12.09x) but these are justified by high growth expectations in semiconductor equipment. Current price is considered fairly valued relative to growth profile and sector peers.
  • P/E (TTM): 35.08x – elevated vs. historical averages but justified by high growth expectations in semiconductor equipment
  • P/B: 12.66x – high, reflecting premium for technological leadership and ROE outperformance
  • P/S (TTM): 12.09x – above sector median, indicating market optimism toward future revenue expansion
  • Base Case (Hold): $320–$360 target range assumes stable multiples and moderate earnings growth (5–10% CAGR)
  • Bull Case (Buy): $380–$420 target requires outperformance in semiconductor capex cycles or margin expansion
  • Bear Case (Sell): Below $300 triggered by industry downturn or execution risks
  • Current Price Assessment: At $324.74, AMAT is fairly valued relative to its growth profile and sector peers
  • Recent pullback (-6.29% on analysis date) may offer an entry point for long-term investors
Valuation trend

Profitability

ROE TTM
26.50%
Net margin
23.65%
Gross margin
48.88%
Total revenue
21.57B
AI Analysis
  • AMAT demonstrates high profitability with strong margins (gross margin 48.88%, net margin 23.65%) and exceptional returns on capital (ROE 26.50%, ROA 14.87%), though recent quarterly EPS showed some decline due to cyclical factors.
  • High profitability with trailing gross margin of 48.88% and net margin of 23.65% (Q3 2025)
  • Underscores efficient operations and pricing power
  • Exceptional returns on capital—ROE of 26.50% and ROA of 14.87% (TTM)
  • Demonstrates effective deployment of equity and assets
  • Recent quarterly EPS declined YoY (-6.33% in Q3 2025)
  • Decline likely due to cyclical downturns or increased R&D/investment
  • Long-term profitability trends remain positive
Profitability
2024Q32024Q42025Q12025Q22025Q3
ROE TTM--40.61%6.30%17.50%26.50%
Earnings
2024Q32024Q42025Q12025Q22025Q3
Total revenue20.13B27.18B7.17B14.27B21.57B

Financial health

Debt/Asset
42.99%
Current ratio
2.50
Quick ratio
1.76
Cash ratio
1.76
AI Analysis
  • AMAT maintains strong financial condition with good liquidity (current ratio 2.50, quick ratio 1.76), moderate leverage (debt-to-asset ratio 42.99%), and consistent revenue growth despite cyclical industry dynamics.
  • Strong liquidity position with current ratio of 2.50 and quick ratio of 1.76
  • Indicates sufficient short-term asset coverage for liabilities
  • Moderate debt levels with debt-to-asset ratio of 42.99%
  • Reflects balanced capital structure and financial flexibility
  • Profitability stability: Revenue growth has been consistent (e.g., 7.14% YoY in Q3 2025)
  • Net income volatility exists due to cyclical industry dynamics and cost pressures
Leverage
2024Q32024Q42025Q12025Q22025Q3
Debt/Asset44.01%44.78%44.13%43.62%42.99%
Liquidity
2024Q32024Q42025Q12025Q22025Q3
Current ratio2.862.512.672.462.50