Applied Materials (NASDAQ:AMAT) Shares Down 3.6% – Here’s What Happened

Applied Materials, Inc. (NASDAQ:AMAT)’s stock price was down 3.6% during trading on Tuesday . The stock traded as low as $438.83 and last traded at $441.85. Approximately 7,102,127 shares changed hands during trading, a decline of 13% from the average session volume of 8,164,674 shares. The stock had previously closed at $458.39.

Trending Headlines about Applied Materials

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

• Positive Sentiment: AI-related equipment demand remains a key growth driver. Applied Materials is benefiting from accelerating fab investments tied to artificial intelligence, advanced packaging, DRAM and high-bandwidth memory (HBM). This supports demand for the company’s wafer-fabrication equipment. AMAT Rides on AI-Led WFE Demand: Can it Sustain the Momentum?
• Positive Sentiment: Analyst outlooks are improving. UBS reportedly projects substantial appreciation for AMAT, while an analyst raised the fiscal 2027 EPS estimate, signaling confidence in longer-term earnings growth. UBS Group Forecasts Strong Price Appreciation for Applied Materials FY2027 EPS Estimate for Applied Materials Boosted by Analyst
• Neutral Sentiment: Industry commentary is broadly bullish but includes a capacity warning. SEMI’s CEO sees a potentially more durable semiconductor upcycle, although concerns about memory capacity could temper enthusiasm for some chip-equipment stocks. SEMI CEO Discusses the Chip Cycle
• Neutral Sentiment: A market report sees long-term growth in wafer-inspection equipment driven by AI, electric vehicles, advanced nodes and packaging, reinforcing the broader addressable-market opportunity for Applied Materials. Semiconductor Wafer Inspection Equipment Market Outlook
• Negative Sentiment: Valuation and recent underperformance are weighing on sentiment. Commentators note that AMAT’s strong year-to-date gain and premium valuation leave less room for execution missteps, while the stock has fallen even after record revenue and raised guidance. Should You Buy, Sell or Hold AMAT Stock?
• Negative Sentiment: Higher crude oil prices and Treasury yields have revived inflation and borrowing-cost concerns, pressuring semiconductor and other growth stocks, including AMAT. Semiconductor Stocks Trade Down Amid Macro Concerns

Analyst Upgrades and Downgrades

A number of analysts have recently issued reports on the company. Erste Group Bank lowered Applied Materials from a “buy” rating to a “hold” rating in a research note on Wednesday, August 5th. JPMorgan Chase & Co. upped their target price on shares of Applied Materials from $515.00 to $660.00 and gave the stock an “overweight” rating in a report on Friday, August 14th. Wolfe Research raised their price target on shares of Applied Materials from $500.00 to $550.00 and gave the stock an “outperform” rating in a research note on Friday, May 15th. Argus set a $600.00 price objective on shares of Applied Materials in a research note on Tuesday, August 18th. Finally, Morgan Stanley decreased their target price on shares of Applied Materials from $646.00 to $642.00 and set an “equal weight” rating on the stock in a research note on Friday, August 14th. One research analyst has rated the stock with a Strong Buy rating, twenty-seven have issued a Buy rating and five have given a Hold rating to the company. Based on data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and an average target price of $658.45.

Applied Materials Price Performance

The company has a quick ratio of 1.79, a current ratio of 2.42 and a debt-to-equity ratio of 0.20. The company has a market cap of $346.31 billion, a price-to-earnings ratio of 37.62, a PEG ratio of 1.23 and a beta of 1.60. The stock’s 50-day simple moving average is $541.33 and its 200 day simple moving average is $460.06.

Applied Materials (NASDAQ:AMAT) last released its quarterly earnings results on Thursday, August 13th. The manufacturing equipment provider reported $3.50 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $3.40 by $0.10. Applied Materials had a net margin of 30.05% and a return on equity of 38.02%. The business had revenue of $9.12 billion for the quarter, compared to the consensus estimate of $8.99 billion. During the same period in the previous year, the firm earned $2.48 EPS. The business’s revenue was up 24.8% on a year-over-year basis. Applied Materials has set its Q4 2026 guidance at 3.820-4.220 EPS. On average, equities research analysts anticipate that Applied Materials, Inc. will post 12.76 EPS for the current fiscal year.

Applied Materials Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, September 10th. Investors of record on Thursday, August 20th will be issued a $0.53 dividend. This represents a $2.12 annualized dividend and a dividend yield of 0.5%. The ex-dividend date is Thursday, August 20th. Applied Materials’s payout ratio is currently 18.28%.

Insider Activity

In other Applied Materials news, insider Prabu G. Raja sold 10,000 shares of Applied Materials stock in a transaction dated Thursday, June 18th. The stock was sold at an average price of $633.53, for a total value of $6,335,300.00. Following the completion of the transaction, the insider directly owned 346,642 shares of the company’s stock, valued at $219,608,106.26. The trade was a 2.80% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available through this link. Also, CEO Gary E. Dickerson sold 71,727 shares of the business’s stock in a transaction dated Tuesday, June 16th. The stock was sold at an average price of $593.75, for a total transaction of $42,587,906.25. Following the sale, the chief executive officer owned 1,695,164 shares in the company, valued at $1,006,503,625. This trade represents a 4.06% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders have sold 231,692 shares of company stock worth $146,114,059 in the last quarter. Insiders own 0.30% of the company’s stock.

Hedge Funds Weigh In On Applied Materials

Several hedge funds and other institutional investors have recently added to or reduced their stakes in the business. Harborfront Financial Group LLC acquired a new stake in Applied Materials in the 2nd quarter valued at about $27,000. Orion Capital Management LLC purchased a new stake in shares of Applied Materials during the second quarter worth approximately $33,000. Highland Investment Advisors LLC purchased a new stake in shares of Applied Materials during the second quarter worth approximately $33,000. BOK Financial Private Wealth Inc. acquired a new stake in Applied Materials in the second quarter valued at approximately $41,000. Finally, Financial Freedom LLC purchased a new position in Applied Materials in the first quarter worth approximately $28,000. Hedge funds and other institutional investors 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.