Applied Materials (NASDAQ:AMAT) Stock Price Up 8.1% on Strong Earnings

Applied Materials, Inc. (NASDAQ:AMAT) rose 8.1% 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 traded hands 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, topping the consensus estimate of $2.19 by $0.19. The firm had revenue of $7.01 billion for the quarter, compared to the consensus estimate of $6.88 billion. Applied Materials had a net margin of 27.78% and a return on equity of 38.52%. The business’s quarterly revenue was down 2.1% on a year-over-year basis. During the same quarter last year, the firm posted $2.38 EPS. Applied Materials has set its Q2 2026 guidance at 2.440-2.840 EPS.

Applied Materials Dividend Announcement

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

Trending Headlines about Applied Materials

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

• Positive Sentiment: Q1 results beat consensus — EPS of $2.38 topped estimates and revenue of $7.01B beat expectations, evidence that services and AI-related demand are offsetting cyclical headwinds. This beat is the primary catalyst for the rally. Applied Materials Q1 Earnings Beat Estimates, Revenues Fall Y/Y
• Positive Sentiment: Strong guidance and AI-driven order cadence — management set Q2 EPS and revenue guidance above Street consensus and highlighted surging orders tied to AI processors and tightening memory demand, supporting a view of sustained equipment spending. Applied Materials jumps as AI demand drives chipmaking tool orders
• Positive Sentiment: Analyst upgrades and price-target increases — multiple firms raised ratings/targets (examples cited include Needham, Mizuho, Citigroup, B. Riley), which amplifies buying momentum and reduces near-term downside from sell-side skepticism.
• Neutral Sentiment: Regulatory settlement resolved — Applied reached a $252.5M civil settlement with the U.S. Department of Commerce over prior export issues; DOJ and SEC closed related probes without action. The payment is a one-time cost but it removes regulatory overhang going forward. Applied Materials Reaches Resolution with the U.S. Department of Commerce
• Negative Sentiment: Valuation concerns and bear case commentary — some analysts and op-eds argue the stock’s run has left limited upside and warn of pricey multiples; this creates the risk of profit-taking if future execution or guidance lags. Applied Materials: Little Opportunity Left After A Monstrous Run

Wall Street Analyst Weigh In

AMAT has been the subject of a number of research analyst reports. Bank of America upped their price target on Applied Materials from $300.00 to $350.00 and gave the stock a “buy” rating in a report on Tuesday, January 13th. Morgan Stanley set a $420.00 target price on shares of Applied Materials in a research report on Friday. Mizuho increased their price target on shares of Applied Materials from $370.00 to $410.00 and gave the company an “outperform” rating in a report on Friday. Royal Bank Of Canada set a $430.00 price target on shares of Applied Materials in a research report on Friday. Finally, Stifel Nicolaus boosted their price objective on shares of Applied Materials from $340.00 to $450.00 and gave the stock a “buy” rating in a report on Friday. Twenty-eight analysts have rated the stock with a Buy rating and six have issued a Hold rating to the company’s stock. According to MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and an average target price of $361.03.

Insider Activity

In other Applied Materials news, SVP Teri A. Little sold 4,000 shares of the firm’s stock in a transaction dated Tuesday, November 25th. The shares were sold at an average price of $238.24, for a total transaction of $952,960.00. Following the completion of the transaction, the senior vice president owned 84,351 shares in the company, valued at $20,095,782.24. This trade represents a 4.53% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, CAO Adam Sanders sold 609 shares of Applied Materials stock in a transaction that occurred 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 directly owned 4,413 shares in the company, valued at $1,127,653.89. The trade was a 12.13% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold 8,609 shares of company stock valued at $2,044,898 in the last three months. Company insiders own 0.30% of the company’s stock.

Institutional Inflows and Outflows

Hedge funds have recently bought and sold shares of the stock. Marquette Asset Management LLC lifted its holdings in Applied Materials by 150.0% during the 3rd quarter. Marquette Asset Management LLC now owns 125 shares of the manufacturing equipment provider’s stock valued at $26,000 after purchasing an additional 75 shares during the last quarter. Redmont Wealth Advisors LLC bought a new stake in Applied Materials during the third quarter worth about $26,000. Wilkerson Advisory Group LLC acquired a new stake in shares of Applied Materials during the fourth quarter worth approximately $26,000. Highline Wealth Partners LLC raised its stake in shares of Applied Materials by 48.7% in the fourth quarter. Highline Wealth Partners LLC now owns 116 shares of the manufacturing equipment provider’s stock valued at $30,000 after acquiring an additional 38 shares during the last quarter. Finally, Financial Gravity Companies Inc. acquired a new position in shares of Applied Materials in the 2nd quarter worth approximately $31,000. 80.56% of the stock is currently owned by institutional investors and hedge funds.

Applied Materials Stock Performance

The stock has a 50-day moving average of $295.20 and a 200 day moving average of $236.38. The firm has a market capitalization of $281.70 billion, a P/E ratio of 36.33, a price-to-earnings-growth ratio of 2.92 and a beta of 1.70. The company has a debt-to-equity ratio of 0.32, a quick ratio of 1.87 and a current ratio of 2.61.

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.