3 Applied Materials Analysts On Earnings After Report Triggers A Rally

Zinger Key Points
  • Applied Materials seems well-positioned for the longer term, with record backlogs, one analyst says.
  • The company may have a strong first half of 2023 followed by a sharp decline thereafter, another analyst states.

Applied Materials, Inc's AMAT quarterly earnings triggered a rally.

Mizuho Securities On Applied Materials

Analyst Vijay Rakesh maintained a Buy rating while raising the price target from $90 to $115.

The company reported healthy revenues and earnings and “guided JanQ to $6.7B/$1.93 (ABOVE consensus $6.3B/$1.79) despite China restrictions,” Rakesh said in a note.

“We believe also potentially while Memory is soft, Korean OEMs might be increasing Memory WFE spend near-term,” the analyst wrote. “We continue to see AMAT well-positioned longer-term, with record backlog, as AMAT sees WFE growth outpacing overall semis,” he added.

Needham On Applied Materials

Analyst Quinn Bolton reiterated a Buy rating while raising the price target from $90 to $120.

“Continued supply chain improvements led to a F4Q22 beat,” Bolton wrote in a note. “AMAT didn't quantify its CY23 WFE outlook (unlike peers) but expects to outperform given its $12.7bn record SSG backlog and AGS strength (should grow Y/Y),” he stated.

“Now, as supply improvements enable demand to catch up, we believe AMAT is set up for a strong F1H23 followed by a sharp decline in F2H23 and a likely down year in FY24,” he added.

Check out other analyst stock ratings.

KeyBanc Capital Markets On Applied Materials

Analyst Steve Barger reaffirmed a Sector Weight rating on the stock.

“AMAT wouldn’t forecast 2023 WFE spend specifically but did acknowledge headwinds from the Memory cycle, weaker demand for consumer-facing products, and China restrictions,” Barger said.

“That said, it expressed confidence it can outgrow the underlying market due to its record backlog, demand for its differentiated product lines that continue to outpace supply, and its growing service business with an increasing share of subscriptions,” the analyst added.

AMAT Price Action: Shares of Applied Materials had risen by 0.79% to $105.27 at the time of publication Friday.

Photo: Pixabay

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Posted In: Analyst ColorEarningsNewsPrice TargetReiterationTop StoriesAnalyst RatingsTechTrading IdeasKeyBanc Capital MarketsMizuho SecuritiesNeedhamQuinn BoltonsemiconductorSteve BargerVijay Rakesh
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