Applied Materials (NASDAQ:AMAT) Shares Up 8.1% After Better-Than-Expected Earnings

Shares of Applied Materials, Inc. (NASDAQ:AMAT) rose 8.1% during trading on Friday following a better than expected earnings announcement. The stock traded as high as $376.32 and last traded at $354.91. Approximately 15,637,759 shares were traded during trading, an increase of 85% from the average daily volume of 8,456,844 shares. The stock had previously closed at $328.39.

The manufacturing equipment provider reported $2.38 EPS for the quarter, beating analysts’ consensus estimates of $2.19 by $0.19. The company had revenue of $7.01 billion during the quarter, compared to the consensus estimate of $6.88 billion. Applied Materials had a return on equity of 39.26% and a net margin of 24.67%.The firm’s revenue for the quarter was down 2.1% on a year-over-year basis. During the same quarter in the prior year, the company earned $2.38 earnings per share. Applied Materials has set its Q2 2026 guidance at 2.440-2.840 EPS.

Applied Materials Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Thursday, March 12th. Investors of record on Thursday, February 19th will be given a dividend of $0.46 per share. The ex-dividend date is Thursday, February 19th. This represents a $1.84 annualized dividend and a dividend yield of 0.5%. Applied Materials’s payout ratio is currently 21.20%.

Applied Materials News Roundup

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

• Positive Sentiment: Q1 results beat and strong forward guidance — AMAT reported $2.38 EPS vs. consensus $2.19 and $7.01B revenue (beat). Management set Q2 EPS guidance of $2.44–2.84 and revenue guidance above estimates, which lifted investor confidence. Q1 Results Release
• Positive Sentiment: AI-driven demand and orders momentum — Management and reporters say surging AI/HPC processor builds and a tightening memory market are driving stronger wafer-fab equipment (WFE) orders, underpinning the upbeat guidance. That narrative is a key catalyst for the rally. Reuters: AI demand drives orders
• Positive Sentiment: Analyst upgrades and higher price targets — Several firms raised ratings/targets after the report (Needham, Mizuho, B. Riley, Citi and others), signaling increased buy-side conviction and adding momentum to the rally. B. Riley target raise (Yahoo)
• Neutral Sentiment: Export‑compliance settlement resolved — Applied agreed to pay $252.5M to settle U.S. Commerce allegations; DOJ and SEC closed related probes without action. That removes an ongoing legal overhang but is a one‑time charge. GlobeNewswire: Settlement
• Negative Sentiment: Valuation and “run-up” concerns — Some analysts/commentators warn the stock has rallied aggressively (large YTD and multi‑month gains), making future upside more dependent on continued execution and exceptionally strong cycles; this raises risk of profit-taking if growth disappoints. Seeking Alpha: Valuation caution

Analysts Set New Price Targets

Several brokerages have recently issued reports on AMAT. TD Cowen increased their target price on Applied Materials from $315.00 to $450.00 and gave the stock a “buy” rating in a research report on Friday. Jefferies Financial Group boosted their target price on shares of Applied Materials from $260.00 to $360.00 and gave the company a “buy” rating in a report on Monday, December 15th. JPMorgan Chase & Co. lifted their price target on shares of Applied Materials from $220.00 to $260.00 and gave the company an “overweight” rating in a research report on Friday, November 14th. Morgan Stanley set a $420.00 target price on shares of Applied Materials in a report on Friday. Finally, B. Riley Securities reaffirmed a “buy” rating and set a $450.00 price objective (up previously from $400.00) on shares of Applied Materials in a research report on Friday. Twenty-eight equities research analysts have rated the stock with a Buy rating and six have given a Hold rating to the stock. Based on data from MarketBeat.com, the stock presently has a consensus rating of “Moderate Buy” and an average target price of $361.03.

Insider Activity at Applied Materials

In other news, SVP Teri A. Little sold 4,000 shares of the stock in a transaction on Tuesday, November 25th. The stock was sold at an average price of $238.24, for a total transaction of $952,960.00. Following the transaction, the senior vice president directly owned 84,351 shares of the company’s stock, valued at $20,095,782.24. This represents a 4.53% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. Also, CAO Adam Sanders sold 609 shares of the company’s stock in a transaction on Monday, December 1st. The shares were sold at an average price of $255.53, for a total value of $155,617.77. Following the sale, the chief accounting officer owned 4,413 shares of the company’s stock, valued at approximately $1,127,653.89. This trade represents a 12.13% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold 8,609 shares of company stock valued at $2,044,898 over the last three months. 0.30% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On Applied Materials

Large investors have recently made changes to their positions in the company. Vanguard Group Inc. boosted its holdings in shares of Applied Materials by 0.4% in the fourth quarter. Vanguard Group Inc. now owns 76,779,340 shares of the manufacturing equipment provider’s stock worth $19,731,523,000 after buying an additional 330,197 shares during the last quarter. State Street Corp raised its position in Applied Materials by 1.0% in the second quarter. State Street Corp now owns 38,920,984 shares of the manufacturing equipment provider’s stock worth $7,125,265,000 after acquiring an additional 391,540 shares during the period. Capital Research Global Investors boosted its stake in shares of Applied Materials by 119.8% during the 4th quarter. Capital Research Global Investors now owns 32,707,049 shares of the manufacturing equipment provider’s stock worth $8,405,458,000 after acquiring an additional 17,829,377 shares during the last quarter. Geode Capital Management LLC increased its stake in shares of Applied Materials by 2.0% in the 2nd quarter. Geode Capital Management LLC now owns 21,026,363 shares of the manufacturing equipment provider’s stock worth $3,836,807,000 after purchasing an additional 407,282 shares in the last quarter. Finally, Alliancebernstein L.P. raised its holdings in Applied Materials by 72.5% in the 2nd quarter. Alliancebernstein L.P. now owns 13,564,120 shares of the manufacturing equipment provider’s stock worth $2,483,183,000 after purchasing an additional 5,700,349 shares during the period. 80.56% of the stock is currently owned by institutional investors.

Applied Materials Stock Up 8.1%

The company has a debt-to-equity ratio of 0.32, a current ratio of 2.61 and a quick ratio of 1.87. The company has a 50-day moving average of $293.46 and a two-hundred day moving average of $235.24. The company has a market capitalization of $281.70 billion, a PE ratio of 40.89, a P/E/G ratio of 3.02 and a beta of 1.70.

Applied Materials Company Profile

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.