In the latest trading session, Applied Materials (AMAT - Free Report) closed at $55.82, marking a -0.11% move from the previous day. This change lagged the S&P 500's daily gain of 0.07%. At the same time, the Dow 0%, and the tech-heavy Nasdaq lost 0.29%.
Heading into today, shares of the maker of chipmaking equipment had gained 13.32% over the past month, outpacing the Computer and Technology sector's gain of 5.79% and the S&P 500's gain of 4.3% in that time.
AMAT will be looking to display strength as it nears its next earnings release, which is expected to be November 14, 2019. On that day, AMAT is projected to report earnings of $0.76 per share, which would represent a year-over-year decline of 21.65%. Meanwhile, our latest consensus estimate is calling for revenue of $3.69 billion, down 8.08% from the prior-year quarter.
Any recent changes to analyst estimates for AMAT should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
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.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.44% lower within the past month. AMAT is holding a Zacks Rank of #3 (Hold) right now.
Valuation is also important, so investors should note that AMAT has a Forward P/E ratio of 16.99 right now. For comparison, its industry has an average Forward P/E of 25.65, which means AMAT is trading at a discount to the group.
It is also worth noting that AMAT currently has a PEG ratio of 3.4. 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 2.94 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 11, putting it in the top 5% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.
You can find more information on all of these metrics, and much more, on Zacks.com.