Applied Materials (NASDAQ:AMAT) Shares Down 5.6% – Here’s Why

Applied Materials, Inc. (NASDAQ:AMAT)’s stock price dropped 5.6% during mid-day trading on Friday . The stock traded as low as $513.22 and last traded at $529.66. Approximately 10,265,738 shares changed hands during trading, an increase of 23% from the average session volume of 8,343,197 shares. The stock had previously closed at $560.93.

Key Headlines Impacting Applied Materials

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

• Positive Sentiment: Erste Group Bank raised its FY2026 and FY2027 earnings estimates for Applied Materials and reiterated a Buy rating, signaling confidence in the company’s growth outlook and AI-driven demand.
• Positive Sentiment: Applied Materials CEO comments reinforcing the AI investment thesis may help support longer-term sentiment around the stock. Article link
• Neutral Sentiment: Zacks noted that AMAT has been drawing increased attention from investors, but the piece was mainly a stock-screening update rather than a new fundamental catalyst. Article link
• Neutral Sentiment: Recent commentary suggested Applied Materials may be trading above fair value after a strong multi-year run, which could limit upside even if earnings remain solid. Article link
• Negative Sentiment: A broad semiconductor selloff is pressuring AMAT along with peers like AMD and Intel, as the market rotates out of chip stocks and into other areas. Article link

Wall Street Analysts Forecast Growth

Several research analysts have weighed in on the company. Morgan Stanley upped their target price on Applied Materials from $502.00 to $647.00 and gave the stock an “equal weight” rating in a research report on Monday, July 6th. Zacks Research raised Applied Materials from a “hold” rating to a “strong-buy” rating in a research note on Wednesday, July 1st. The Goldman Sachs Group increased their price objective on Applied Materials from $390.00 to $520.00 and gave the stock a “buy” rating in a report on Friday, May 15th. Cantor Fitzgerald raised their price objective on shares of Applied Materials from $650.00 to $850.00 and gave the company an “overweight” rating in a research report on Monday, June 29th. Finally, Seaport Research Partners initiated coverage on shares of Applied Materials in a research note on Monday, May 4th. They issued a “buy” rating and a $500.00 target price for the company. One equities research analyst has rated the stock with a Strong Buy rating, twenty-seven have issued a Buy rating and six have given a Hold rating to the company. Based on data from MarketBeat.com, the company currently has an average rating of “Moderate Buy” and a consensus target price of $593.84.

Applied Materials Stock Down 5.6%

The company has a market cap of $420.53 billion, a price-to-earnings ratio of 49.73, a PEG ratio of 1.47 and a beta of 1.57. The business has a 50-day simple moving average of $531.23 and a two-hundred day simple moving average of $412.23. 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 data 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 business 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 firm’s revenue for the quarter was up 11.4% on a year-over-year basis. During the same quarter in the prior year, the firm posted $2.39 EPS. Applied Materials has set its Q3 2026 guidance at 3.160-3.560 EPS. As a group, equities analysts forecast that Applied Materials, Inc. will post 12.13 earnings per share 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 issued a dividend of $0.53 per share. This represents a $2.12 annualized dividend and a yield of 0.4%. The ex-dividend date is Thursday, August 20th. Applied Materials’s dividend payout ratio (DPR) is 19.91%.

Insider Buying and Selling

In related news, CEO Gary E. Dickerson sold 71,727 shares of the firm’s stock in a transaction on Tuesday, June 16th. The shares were sold at an average price of $593.75, for a total value of $42,587,906.25. Following the transaction, the chief executive officer directly owned 1,695,164 shares in the company, valued at approximately $1,006,503,625. This trade represents a 4.06% decrease in their position. The transaction was disclosed in a filing with the SEC, which is available through this link. Also, Director Thomas J. Iannotti sold 9,250 shares of Applied Materials stock in a transaction on Tuesday, June 16th. The stock was sold at an average price of $599.77, for a total transaction of $5,547,872.50. Following the completion of the transaction, the director owned 40,559 shares in the company, valued at $24,326,071.43. This trade represents a 18.57% decrease in their position. The SEC filing for this sale provides additional information. Over the last 90 days, insiders have sold 278,088 shares of company stock valued at $169,654,805. 0.30% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On Applied Materials

Hedge funds have recently bought and sold shares of the company. Evolve Private Wealth LLC increased its position in Applied Materials by 59.0% in the 1st quarter. Evolve Private Wealth LLC now owns 2,875 shares of the manufacturing equipment provider’s stock worth $983,000 after buying an additional 1,067 shares during the period. Worth Asset Management LLC acquired a new position in shares of Applied Materials during the fourth quarter worth approximately $1,531,000. World Investment Advisors boosted its position in shares of Applied Materials by 4.5% in the fourth quarter. World Investment Advisors now owns 82,296 shares of the manufacturing equipment provider’s stock valued at $21,149,000 after acquiring an additional 3,508 shares during the period. WealthPlan Investment Management LLC acquired a new stake in shares of Applied Materials in the fourth quarter worth $1,082,000. Finally, Baker Chad R grew its stake in shares of Applied Materials by 76.6% in the fourth quarter. Baker Chad R now owns 16,530 shares of the manufacturing equipment provider’s stock worth $4,297,000 after acquiring an additional 7,170 shares during the last quarter. 80.56% of the stock is currently owned by institutional investors.

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.