Fact based stock research
Applied Materials (NasdaqGS:AMAT)

US0382221051

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Applied Materials stock research in summary

appliedmaterials.com

ANALYSIS: With an Obermatt Combined Rank of 55 (better than 55% compared with investment alternatives), Applied Materials (Semiconductor Equipment, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Applied Materials are a good value (attractively priced) with a consolidated Value Rank of 77 (better than 77% of alternatives), are safely financed (Safety Rank of 50, which means low debt burdens), but show below-average growth (Growth Rank of 35). ...read more

RECOMMENDATION: A Combined Rank of 55, is a buy recommendation based on Applied Materials's financial characteristics. As the company Applied Materials's key financial metrics exhibit good value (Obermatt Value Rank of 77) but low growth (Obermatt Growth Rank of 35) while being safely financed (Obermatt Safety Rank of 50), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 77% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	77
Growth Rank	35
Safety Rank	50
Combined Rank	55

Country	USA
Industry	Semiconductor Equipment
Index	Dividends USA, Renewables Users, NASDAQ 100, NASDAQ, S&P 500
Size class	XX-Large

This stock has achievements: Top 10 Stock.

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Applied Materials

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	74	83	75	77
GROWTH
GROWTH	82	29	86	35
SAFETY
SAFETY	88	36	44	50
SENTIMENT
SENTIMENT	n/a	41	95	^new
360° VIEW
360° VIEW	n/a	41	92	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 27-Oct-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Applied Materials is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	74	83	75	77
GROWTH
GROWTH	82	29	86	35
SAFETY
SAFETY	88	36	44	50
COMBINED
COMBINED	98	49	84	55

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Applied Materials the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 77 (better than 77% compared with alternatives) for 2024, Applied Materials shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Applied Materials. Price-to-Profit (also referred to as price-earnings, P/E) is 72 which means that the stock price compared with what market professionals expect for future profits is lower than for 72% of comparable companies, indicating a good value concerning Applied Materials's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 27, which means that the stock price is lower as regards to invested capital than for 27% of comparable investments. On the other hand, Price-to-Sales is less favorable than 61% of alternatives (only 39% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 15% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 77, is a buy recommendation based on Applied Materials's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	54	50	40	39
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	83	67	67	72
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	24	22	14	27
DIVIDEND YIELD
DIVIDEND YIELD	86	89	89	85
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	74	83	75	77

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Applied Materials; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 35 (better than 35% compared with alternatives), Applied Materials shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Applied Materials. Profit Growth has a rank of 50, which means that currently professionals expect the company to grow its profits more than 50% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 65 (above 65% of alternative investments). But Sales Growth has a below the median rank of 34, which means that, currently, professionals expect the company to grow less than 66% of its competitors, and Capital Growth also has a lower rank of 30. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 35, is a hold recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for Applied Materials. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	46	15	57	34
PROFIT GROWTH
PROFIT GROWTH	91	27	65	50
CAPITAL GROWTH
CAPITAL GROWTH	n/a	56	83	30
STOCK RETURNS
STOCK RETURNS	92	85	77	65
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	82	29	86	35

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Applied Materials.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 50 (better than 50% compared with alternatives), the company Applied Materials has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Applied Materials is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Applied Materials. Liquidity is at 78, meaning the company generates more profit to service its debt than 78% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 35, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 65% of its competitors. Leverage is also high at a rank of 38, which means that the company has an above-average debt-to-equity ratio. It has more debt than 62% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 50 (better than 50% compared with alternatives), Applied Materials has a financing structure that is safer than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. If the company is sailing with good winds, as may be visible from the Growth and Sentiment performance, the refinancing risk may be lower than the low Refinancing rank suggests. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	52	42	41	38
REFINANCING
REFINANCING	54	1	26	35
LIQUIDITY
LIQUIDITY	87	86	76	78
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	88	36	44	50

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Applied Materials and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	56	60	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	49	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	19	97	^new
MARKET PULSE
MARKET PULSE	n/a	70	68	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	41	95	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Applied Materials.
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