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Applied Materials (AMAT) Outpaces Stock Market Gains: What You Should Know

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Applied Materials (AMAT - Free Report) closed the most recent trading day at $63.29, moving +1.1% from the previous trading session. This move outpaced the S&P 500's daily gain of 0.88%. At the same time, the Dow added 0.57%, and the tech-heavy Nasdaq gained 1.39%.

Prior to today's trading, shares of the maker of chipmaking equipment had gained 13.57% over the past month. This has outpaced the Computer and Technology sector's gain of 4.73% and the S&P 500's gain of 3.54% in that time.

Wall Street will be looking for positivity from AMAT as it approaches its next earnings report date. In that report, analysts expect AMAT to post earnings of $1.17 per share. This would mark year-over-year growth of 46.25%. Meanwhile, our latest consensus estimate is calling for revenue of $4.60 billion, up 22.65% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.07 per share and revenue of $17.11 billion, which would represent changes of +33.88% and +17.15%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for AMAT. These revisions typically reflect the latest short-term business trends, which can change frequently. 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. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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 remained stagnant. AMAT is currently sporting a Zacks Rank of #2 (Buy).

In terms of valuation, AMAT is currently trading at a Forward P/E ratio of 15.39. For comparison, its industry has an average Forward P/E of 16.43, which means AMAT is trading at a discount to the group.

We can also see that AMAT currently has a PEG ratio of 1.22. 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 1.3 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 35, putting it in the top 14% 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.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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