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Applied Materials (AMAT) Gains As Market Dips: What You Should Know

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In the latest trading session, Applied Materials (AMAT - Free Report) closed at $97.38, marking a +0.25% move from the previous day. The stock outpaced the S&P 500's daily loss of 0.25%. Meanwhile, the Dow lost 0.22%, and the Nasdaq, a tech-heavy index, added 5.91%.

Prior to today's trading, shares of the maker of chipmaking equipment had lost 9.22% over the past month. This has lagged the Computer and Technology sector's loss of 3.63% and the S&P 500's loss of 2.59% in that time.

Wall Street will be looking for positivity from Applied Materials as it approaches its next earnings report date. On that day, Applied Materials is projected to report earnings of $1.93 per share, which would represent year-over-year growth of 2.12%. Our most recent consensus estimate is calling for quarterly revenue of $6.68 billion, up 6.59% from the year-ago period.

AMAT's full-year Zacks Consensus Estimates are calling for earnings of $6.83 per share and revenue of $24.43 billion. These results would represent year-over-year changes of -11.3% and -5.26%, respectively.

Investors might also notice recent changes to analyst estimates for Applied Materials. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.1% lower. Applied Materials is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, Applied Materials currently has a Forward P/E ratio of 14.21. This valuation marks a premium compared to its industry's average Forward P/E of 13.73.

We can also see that AMAT currently has a PEG ratio of 2.07. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Semiconductor Equipment - Wafer Fabrication stocks are, on average, holding a PEG ratio of 1.72 based on yesterday's closing prices.

The Semiconductor Equipment - Wafer Fabrication industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 48, putting it in the top 20% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow AMAT in the coming trading sessions, be sure to utilize Zacks.com.


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