Santa Clara, California-based Applied Materials, Inc. (AMAT) provides materials engineering solutions, equipment, services, and software to the semiconductor and related industries in the United States and internationally. The company has a market cap of $264 billion and operates through Semiconductor Systems and Applied Global Services (AGS) segments.
AMAT shares have rallied the broader market over the past year and surged 42.5% compared to the S&P 500 Index’s ($SPX) 9.8% surge. Moreover, in 2026, the stock has grown nearly 29.5%, outperforming the SPX’s 7.8% rise as well.
Focusing on its industry benchmark, the State Street Technology Select Sector SPDR ETF (XLK) has risen 13.9% over the past year, underperforming the stock. In 2026, as well, XLK surged 14.4% and has lagged behind the stock.
AMAT has stood out as one of the premier chip stocks over the past year owing to its impressive fundamentals and bright future. The company’s forecasted revenue growth is sitting at 45%, above its two-year trend, indicating potentially higher demand in the coming year. Moreover, its operating margin of nearly 30% showcases signs of a well-run company with efficient processes. Paired with its amazing returns on capital, AMAT is positioned as a highly profitable company, with tailwinds being the higher chip demand due to the AI boom.
For the quarter that ended in October, analysts expect AMAT’s EPS to rise 35.8% year over year to $12.79. Moreover, the company has surpassed analysts’ consensus estimates in each of the past four quarters.
Among the 37 analysts covering the stock, the consensus rating is a “Strong Buy.” That’s based on 26 “Strong Buy” ratings, three “Moderate Buy” ratings, and eight “Holds.”
The configuration has grown more bearish over the past month.
On Nov. 3, UBS analyst Timothy Arcuri maintained a “Buy” rating on Applied Materials and set a price target of $695.
AMAT’s mean price target of $634.94 offers a 90.8% upside compared to the current market price. Its Street-high target of $900 suggests an impressive 170.5% upside potential from current price levels.
On the date of publication, Aritra Gangopadhyay did not directly have a position in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.