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If You Invested $1000 in Applied Materials a Decade Ago, This is How Much It'd Be Worth Now

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For most investors, how much a stock's price changes over time is important. This factor can impact your investment portfolio as well as help you compare investment results across sectors and industries.

FOMO, or the fear of missing out, also plays a role in investing, particularly with tech giants and popular consumer-facing stocks.

What if you'd invested in Applied Materials (AMAT - Free Report) ten years ago? It may not have been easy to hold on to AMAT for all that time, but if you did, how much would your investment be worth today?

Applied Materials' Business In-Depth

With that in mind, let's take a look at Applied Materials' main business drivers.

Headquartered in Santa Clara, California, Applied Materials is one of the world’s largest suppliers of equipment for the fabrication of semiconductor, flat panel liquid crystal displays (LCDs), and solar photovoltaic (PV) cells and modules. The company also offers deployment and support services related to the equipment supplied.

In fiscal year 2023, Applied reported results in three segments—Semiconductor Systems (74% of total 2023 revenue), Applied Global Services (22%) and Display and Adjacent Markets (4%).

Applied Materials’ Silicon segment offers equipment for front-end operations in the semiconductor manufacturing process. Front-end processes involve the deposition or implantation of multiple thin layers of electronically conductive, semiconductive and insulating materials onto and within a silicon wafer with the help of photomasks (reticles) to give multiple copies of integrated circuit devices.

With over 33,000 systems installed, the Applied Global Services segment goes a long way to ensure customer satisfaction and support. There are primarily three kinds of services offered.

Applied has developed technologies for significantly larger-sized wafers made of materials other than silicon. This has helped it expand its portfolio into equipment for thin film transistor (TFT) LCDs (made from glass) and OLED, which are used in smartphones, TVs and other consumer electronic devices. The company operates this business under the Display segment.

The Energy and Environmental Solutions segment primarily consists of the solar product line. Currently, the company offers equipment for manufacturing both wafer-based crystalline silicon (c-Si) and glass-based thin film used in the solar PV cell fabrication process.

Being a leading producer of specialized equipment, most of the competition comes from other large equipment makers, such as KLAC and LRCX.

Bottom Line

While anyone can invest, building a lucrative investment portfolio takes research, patience, and a little bit of risk. If you had invested in Applied Materials ten years ago, you're probably feeling pretty good about your investment today.

According to our calculations, a $1000 investment made in February 2014 would be worth $10,643.73, or a gain of 964.37%, as of February 20, 2024, and this return excludes dividends but includes price increases.

Compare this to the S&P 500's rally of 173.72% and gold's return of 47.57% over the same time frame.

Analysts are anticipating more upside for AMAT.

Applied Materials’ fiscal first quarter results were driven by strength in Applied Global Services (AGS) segment owing to growing adoption of 200-mm system. Solid momentum in subscription business, was a plus. Also, strengthening Display segment contributed well. Notably, the stock has outperformed its industry over a year. AMAT remains optimistic about its strategies and investments in IoT and AI. Additionally, its strength in IoT, Communications, Auto, Power and Sensors (ICAPS) is likely to continue aiding its position in the semiconductor industry in the days ahead. Further, its broad-based, diversified portfolio and strong services business remain its key growth drivers. However, softness in the Semiconductor Systems segment remains a concern. Also, weakening demand environment and geo-political tensions are headwinds.

The stock is up 18.58% over the past four weeks, and no earnings estimate has gone lower in the past two months, compared to 3 higher, for fiscal 2024. The consensus estimate has moved up as well.

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