Market Analysis: Applied Mat And Competitors In Semiconductors & Semiconductor Equipment Industry

Amidst the fast-paced and highly competitive business environment of today, conducting comprehensive company analysis is essential for investors and industry enthusiasts. In this article, we will delve into an extensive industry comparison, evaluating Applied Mat AMAT in comparison to its major competitors within the Semiconductors & Semiconductor Equipment industry. By analyzing critical financial metrics, market position, and growth potential, our objective is to provide valuable insights for investors and offer a deeper understanding of company's performance in the industry.

Applied Mat Background

Applied Materials is the largest semiconductor wafer fabrication equipment, or WFE, manufacturer in the world. Applied Materials has a broad portfolio spanning nearly every corner of the WFE ecosystem. Specifically, Applied Materials holds a market share leadership position in deposition, which entails the layering of new materials on semiconductor wafers. It is more exposed to general-purpose logic chips made at integrated device manufacturers and foundries. It counts the largest chipmakers in the world as customers, including TSMC, Intel, and Samsung.

Company P/E P/B P/S ROE EBITDA (in billions) Gross Profit (in billions) Revenue Growth
Applied Materials Inc 18.37 7.57 4.75 12.75% $2.36 $3.17 -0.39%
ASML Holding NV 33.27 21.14 9.45 16.76% $2.36 $3.46 15.48%
Lam Research Corp 24.84 11.99 6.24 10.92% $1.16 $1.65 -31.38%
KLA Corp 24.34 24.74 7.43 25.09% $1.03 $1.45 -12.02%
Entegris Inc 82.65 4.90 4.53 0.99% $0.2 $0.37 -10.62%
Enphase Energy Inc 28.92 15.53 6.17 11.47% $0.16 $0.26 -13.18%
Teradyne Inc 47.80 6.44 10.97 5.25% $0.17 $0.4 -64.91%
Amkor Technology Inc 18.46 1.93 1.12 3.5% $0.33 $0.28 -12.57%
Onto Innovation Inc 42.83 3.94 7.89 2.14% $0.05 $0.11 -18.51%
SolarEdge Technologies Inc 21.52 1.82 1.33 -2.44% $-0.0 $0.14 -13.32%
Axcelis Technologies Inc 16.86 4.82 3.60 8.53% $0.08 $0.13 27.56%
Kulicke & Soffa Industries Inc 51.32 2.45 3.94 1.99% $0.04 $0.1 -29.34%
Photronics Inc 14.18 1.85 1.99 4.61% $0.1 $0.08 8.18%
Veeco Instruments Inc 27.72 2.50 2.50 3.99% $0.03 $0.08 3.17%
Cohu Inc 30.55 1.66 2.30 0.41% $0.02 $0.07 -27.04%
PDF Solutions Inc 423.14 5.12 6.92 -2.23% $0.0 $0.03 6.25%
ACM Research Inc 15.70 1.41 2.21 3.61% $0.03 $0.09 26.07%
Aehr Test Systems 35.14 8.08 8.83 6.0% $0.0 $0.01 93.27%
inTest Corp 11.96 1.60 1.10 3.18% $0.0 $0.02 6.15%
Average 52.84 6.77 4.92 5.76% $0.32 $0.49 -2.6%

By conducting a comprehensive analysis of Applied Mat, the following trends become evident:

  • A Price to Earnings ratio of 18.37 significantly below the industry average by 0.35x suggests undervaluation. This can make the stock appealing for those seeking growth.

  • The elevated Price to Book ratio of 7.57 relative to the industry average by 1.12x suggests company might be overvalued based on its book value.

  • Based on its sales performance, the stock could be deemed undervalued with a Price to Sales ratio of 4.75, which is 0.97x the industry average.

  • The company has a higher Return on Equity (ROE) of 12.75%, which is 6.99% above the industry average. This suggests efficient use of equity to generate profits and demonstrates profitability and growth potential.

  • The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $2.36 Billion is 7.37x above the industry average, highlighting stronger profitability and robust cash flow generation.

  • The company has higher gross profit of $3.17 Billion, which indicates 6.47x above the industry average, indicating stronger profitability and higher earnings from its core operations.

  • The company is experiencing remarkable revenue growth, with a rate of -0.39%, outperforming the industry average of -2.6%.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio helps evaluate the capital structure and financial leverage of a company.

Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.

In light of the Debt-to-Equity ratio, a comparison between Applied Mat and its top 4 peers reveals the following information:

  • Applied Mat has a stronger financial position compared to its top 4 peers, as evidenced by its lower debt-to-equity ratio of 0.37.

  • This suggests that the company has a more favorable balance between debt and equity, which can be perceived as a positive indicator by investors.

Key Takeaways

The valuation analysis for Applied Mat in the Semiconductors & Semiconductor Equipment industry indicates that its PE ratio is low compared to its peers, suggesting that the stock may be undervalued. The PB ratio is high, indicating that the market values the company's assets at a premium. The PS ratio is low, suggesting that the stock may be undervalued based on its sales. On the other hand, Applied Mat has a high ROE, EBITDA, gross profit, and revenue growth compared to its peers, indicating strong financial performance.

This article was generated by Benzinga's automated content engine and reviewed by an editor.

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