Key statistics

Is AMAT a good stock to buy in 2026?

AMAT stock presents a mixed signal for investors as of late March 2026. While its P/E ratio of 34.11x trades at a discount compared to the Semiconductor sector average of 46.5x, suggesting relative value, a concerning discounted cash flow (DCF) analysis points to a fair value of $-371.12, indicating significant overvaluation. Despite this, a strong analyst consensus exists, with 79.3% rating AMAT as a “Buy,” suggesting continued confidence in its market position and future growth prospects. Not investment advice.

2026 AMAT price scenarios

Based on analyst consensus of $420.83 from 53 analysts. Not a prediction by Alert Invest.

About Applied Materials, Inc. (AMAT)

Applied Materials, Inc. provides manufacturing equipment, services, and software to the semiconductor, display, and related industries. It operates through three segments: Semiconductor Systems, Applied Global Services, and Display and Adjacent Markets. The Semiconductor Systems segment develops, manufactures, and sells various manufacturing equipment that is used to fabricate semiconductor chips or integrated circuits. This segment also offers various technologies, including epitaxy, ion implan

Applied Materials, Inc., led by CEO Gary E. Dickerson, stands as a global leader in providing innovative equipment, services, and software integral to the manufacturing of semiconductor chips, displays, and other advanced technology products. With approximately 36,000 employees worldwide, AMAT’s distinctive strength lies in its comprehensive portfolio of solutions that enable customers to produce cutting-edge devices, ranging from advanced logic and memory to flat panel displays for smartphones and TVs. The company’s critical role in the foundational technology of the digital economy solidifies its position as an indispensable partner for the world’s leading technology manufacturers, driving innovation across the entire ecosystem.

AMAT competitive moat and business analysis

Applied Materials operates within a highly specialized industry, where its competitive advantage is deeply rooted in its proprietary technology, extensive intellectual property, and long-standing relationships with leading chipmakers. The company boasts an excellent net margin of 27.78%, reflecting its pricing power and operational efficiency. While specific ROE/ROIC figures are not provided (N/A), such high margins typically indicate a strong return on capital in this capital-intensive sector. These strong profitability metrics highlight AMAT’s ability to maintain healthy earnings despite significant R&D investments, fortifying its position in the semiconductor equipment market.

Regarding revenue breakdown, detailed segment and geographical data is crucial for understanding AMAT’s diversified business. Based on fiscal year 2024 data (symbol AMAT, fiscalYear 2024, period FY, reportedCurrency USD, date 2024-10-27), Applied Materials’ revenue streams primarily emanate from its Semiconductor Systems, Applied Global Services, and Display and Adjacent Markets segments. This segmentation illustrates its broad reach across the technology landscape, providing essential tools and services for chip fabrication, equipment maintenance, and emerging display technologies. Geographically, AMAT maintains a robust global presence, with significant contributions from key regions driving semiconductor manufacturing, which is vital for de-risking against regional downturns and capitalizing on global demand shifts.

The competitive moat of AMAT is further bolstered by its continuous innovation and significant R&D expenditures, which are essential to keep pace with the rapid technological advancements in the semiconductor industry. With a recent revenue growth of 4.4%, the company demonstrates its ability to expand, albeit at a moderate pace, in a cyclical industry. While no specific transcript quote is available, management typically emphasizes the importance of sustained innovation in deposition, etch, and other critical process technologies to extend their leadership and capture new market opportunities arising from AI, 5G, and automotive advancements, ensuring the long-term relevance of AMAT stock.

When evaluating AMAT stock against its peers, a detailed comparison is essential to understand its unique market position. Investors often look at AMAT vs ARM for insights into intellectual property and design focus, contrasting AMAT’s equipment provision. A comparison of AMAT vs INTC highlights differences in their value chain roles, contrasting equipment provision with direct chip manufacturing capabilities. Similarly, while AMAT vs INTU might seem disparate due to Intuit being a software company, it can serve as a benchmark for broader technology sector performance and valuation multiples, allowing investors to gauge AMAT’s unique specialized niche and performance relative to other significant players in the technology and semiconductor sectors.

Applied Materials, Inc. analyst rating

Based on 53 analysts. 79.3% rate AMAT Buy or Strong Buy.

A substantial 79.3% “Buy” or “Strong Buy” rating from 53 analysts is indeed a very strong consensus for a company in the dynamic Technology sector, suggesting high confidence in AMAT’s future performance. This strong backing typically signals that analysts anticipate continued growth and outperformance relative to the broader market, making AMAT stock a noteworthy consideration for those aligning with expert sentiment.

Is AMAT undervalued or overvalued?

When assessing AMAT valuation, its P/E ratio of 34.11x stands out when compared to the Semiconductors sector average of 46.5x. This indicates that AMAT stock is trading at a discount relative to its industry peers on an earnings multiple basis, which could be an attractive point for investors seeking value within the sector. Despite this, the market’s current pricing of AMAT still reflects a premium given the nature of the high-growth technology industry.

However, a deeper dive into AMAT’s intrinsic value using a discounted cash flow (DCF) model presents a more cautious picture, with a fair value estimate of $-371.12. This significantly negative DCF figure suggests that, based on current cash flow projections, AMAT may be substantially overvalued, or that the model’s assumptions are highly conservative for a growth stock. Investors performing their own AMAT valuation should reconcile these contrasting signals by considering both relative valuations and intrinsic models, alongside growth prospects and market sentiment, to determine if AMAT is a good stock for their portfolio.

AMAT financial health & key metrics

For value investors, AMAT presents a mixed bag. While the P/E ratio indicates a discount to the sector, suggesting a potentially attractive entry point based on current earnings, the deeply negative DCF fair value is a significant red flag for those focused on intrinsic value. The company’s strong profitability, evidenced by an excellent net margin of 27.78% and low debt, points to robust operational health. However, a moderate revenue growth of 4.4% and a fair FCF yield of 2.31% suggest growth might be slowing, prompting a careful balance between profitability and perceived valuation for AMAT stock.

Applied Materials, Inc. earnings history & next report

Applied Materials, Inc. reported EPS of $2.38, beating estimates by 7.69%. Next earnings: 2026-05-21 with EPS estimate of $2.66.

Applied Materials recently reported EPS of $2.38, surpassing estimates by a solid 7.69%, demonstrating the company’s ability to exceed market expectations. The next earnings report is scheduled for 2026-05-21, with an estimated EPS of $2.66. Investors will closely watch this upcoming report for indications of continued strong demand for semiconductor manufacturing equipment, particularly concerning advanced technologies like AI and next-generation memory. Key focus areas will include management’s guidance on future revenue and profitability, updates on supply chain dynamics, and any insights into capital expenditure trends from major chip manufacturers globally, as these factors significantly influence AMAT stock performance.

AMAT insider trading activity

Corporate insiders must report trades to the SEC within two business days.

Source: SEC Form 4 via EDGAR · Data: Financial Modeling Prep · Not investment advice

Recent AMAT analyst rating changes

Applied Materials, Inc. stock news today

How does AMAT compare to its peers?

Understanding the competitive landscape is crucial when evaluating AMAT stock. Applied Materials operates within the broader Technology sector, specifically the Semiconductors industry, where it competes with a range of companies offering different aspects of semiconductor technology and services. Comparing AMAT to its peers can provide valuable insights into its relative strengths, weaknesses, and market positioning within this rapidly evolving industry.

FAQ — Applied Materials, Inc. (AMAT) stock