Applied Materials (NASDAQ:AMAT) Shares Gap Up – Still a Buy?

Applied Materials, Inc. (NASDAQ:AMAT) gapped up before the market opened on Thursday . The stock had previously closed at $588.97, but opened at $637.74. Applied Materials shares last traded at $617.3870, with a volume of 2,037,412 shares trading hands.

Applied Materials News Roundup

Here are the key news stories impacting Applied Materials this week:

• Positive Sentiment: Applied Materials introduced new chipmaking systems for DRAM and advanced packaging, including tools aimed at improving AI-chip stacking, memory efficiency, and defect review. Article Title
• Positive Sentiment: Multiple analysts turned more bullish, with price targets raised as high as $715-$720, reflecting expectations that strong demand for semiconductor equipment and AI infrastructure spending will continue. Article Title
• Positive Sentiment: Commentary from market watchers and research notes suggest AMAT could have more upside as AI-led chip demand remains strong and the company’s valuation is still seen as reasonable relative to its growth outlook. Article Title
• Neutral Sentiment: One article highlighted AMAT’s heavy share price rally and raised valuation concerns, but it did not change the broader bullish tone around AI spending and equipment demand. Article Title
• Negative Sentiment: Recent broader AI-chip weakness, including reports that SK Hynix may slow HBM expansion, briefly pressured AMAT and other semiconductor equipment names. Article Title

Analysts Set New Price Targets

Several research analysts have recently commented on AMAT shares. Argus lifted their target price on Applied Materials from $420.00 to $500.00 and gave the stock a “buy” rating in a research report on Tuesday, May 19th. HSBC assumed coverage on Applied Materials in a research note on Friday, May 8th. They set a “buy” rating and a $517.00 price objective on the stock. Cantor Fitzgerald lifted their price objective on shares of Applied Materials from $575.00 to $650.00 and gave the stock an “overweight” rating in a report on Wednesday, June 10th. Erste Group Bank upgraded shares of Applied Materials from a “hold” rating to a “buy” rating in a research note on Monday, April 27th. Finally, Wall Street Zen raised shares of Applied Materials from a “hold” rating to a “buy” rating in a report on Saturday, May 23rd. Twenty-seven analysts have rated the stock with a Buy rating and eight have assigned a Hold rating to the company’s stock. Based on data from MarketBeat, Applied Materials has a consensus rating of “Moderate Buy” and an average target price of $501.26.

Applied Materials Stock Performance

The company has a market cap of $502.72 billion, a P/E ratio of 59.42, a PEG ratio of 1.63 and a beta of 1.67. The company has a 50 day moving average price of $463.44 and a 200-day moving average price of $372.78. The company has a quick ratio of 1.80, a current ratio of 2.51 and a debt-to-equity ratio of 0.22.

Applied Materials (NASDAQ:AMAT) last issued its quarterly earnings results on Thursday, May 14th. The manufacturing equipment provider reported $2.86 EPS for the quarter, beating analysts’ consensus estimates of $2.68 by $0.18. The company had revenue of $7.91 billion for the quarter, compared to analyst estimates of $7.68 billion. Applied Materials had a return on equity of 36.97% and a net margin of 29.31%.The company’s quarterly revenue was up 11.4% compared to the same quarter last year. During the same period last year, the company earned $2.39 earnings per share. Applied Materials has set its Q3 2026 guidance at 3.160-3.560 EPS. Equities analysts expect that Applied Materials, Inc. will post 12.1 EPS for the current fiscal year.

Applied Materials Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Thursday, September 10th. Shareholders of record on Thursday, August 20th will be given a dividend of $0.53 per share. This represents a $2.12 dividend on an annualized basis and a dividend yield of 0.3%. The ex-dividend date is Thursday, August 20th. Applied Materials’s payout ratio is 19.91%.

Insider Buying and Selling

In other news, SVP Omkaram Nalamasu sold 24,263 shares of the stock in a transaction that occurred on Tuesday, June 16th. The shares were sold at an average price of $593.43, for a total value of $14,398,392.09. Following the completion of the transaction, the senior vice president directly owned 146,916 shares in the company, valued at $87,184,361.88. This trade represents a 14.17% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, CEO Gary E. Dickerson sold 71,727 shares of the firm’s stock in a transaction that occurred on Tuesday, June 16th. The shares were sold at an average price of $593.75, for a total transaction of $42,587,906.25. Following the transaction, the chief executive officer owned 1,695,164 shares in the company, valued at $1,006,503,625. This represents a 4.06% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last quarter, insiders sold 199,767 shares of company stock worth $114,104,709. Company insiders own 0.30% of the company’s stock.

Institutional Trading of Applied Materials

Several institutional investors have recently modified their holdings of the company. Basecamp Wealth Advisors LLC raised its holdings in shares of Applied Materials by 0.7% in the 1st quarter. Basecamp Wealth Advisors LLC now owns 3,288 shares of the manufacturing equipment provider’s stock worth $1,124,000 after purchasing an additional 22 shares in the last quarter. Sapient Capital LLC bought a new stake in Applied Materials during the first quarter worth approximately $217,000. Western Wealth Management LLC boosted its holdings in Applied Materials by 16.1% during the first quarter. Western Wealth Management LLC now owns 4,829 shares of the manufacturing equipment provider’s stock worth $1,650,000 after buying an additional 669 shares in the last quarter. Militia Capital Management LLC acquired a new position in Applied Materials in the first quarter worth approximately $295,000. Finally, Pine Valley Investments Ltd Liability Co grew its position in Applied Materials by 10.9% in the first quarter. Pine Valley Investments Ltd Liability Co now owns 29,297 shares of the manufacturing equipment provider’s stock worth $10,013,000 after buying an additional 2,890 shares during the last quarter. Institutional investors and hedge funds own 80.56% of the company’s stock.

About Applied Materials

Applied Materials, Inc is a U.S.-based supplier of equipment, services and software used to manufacture semiconductor chips, flat panel displays and other advanced materials. Headquartered in Santa Clara, California, the company designs and sells capital equipment and related technologies that enable production of integrated circuits, display panels and materials used across the electronics supply chain.

Applied Materials’ offerings include process equipment and factory software that support critical steps in device fabrication, such as deposition, etch, implantation, inspection and metrology, as well as systems for packaging and advanced heterogeneous integration.