Here's Why Applied Materials (AMAT) Fell More Than Broader Market

Applied Materials (AMAT) ended the recent trading session at $411.94, demonstrating a -3.89% change from the preceding day's closing price. This change lagged the S&P 500's 0.38% loss on the day. Meanwhile, the Dow lost 0.63%, and the Nasdaq, a tech-heavy index, lost 0.13%. Prior to today's trading, shares of the maker of chipmaking equipment had gained 11.12% lagged the Computer and Technology sector's gain of 22.04% and the S&P 500's gain of 11.41%.Investors will be eagerly watching for the performance of Applied Materials in its upcoming earnings disclosure. The company's earnings report is set to be unveiled on May 14, 2026. The company is expected to report EPS of $2.68, up 12.13% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $7.69 billion, up 8.35% from the year-ago period. In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $11.14 per share and a revenue of $31.7 billion, indicating changes of +18.26% and +11.74%, respectively, from the former year. Investors should also take note of any recent adjustments to analyst estimates for Applied Materials. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability. Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. 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. The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Within the past 30 days, our consensus EPS projection has moved 0.35% higher. Applied Materials is currently a Zacks Rank #2 (Buy). In the context of valuation, Applied Materials is at present trading with a Forward P/E ratio of 38.47. For comparison, its industry has an average Forward P/E of 47.37, which means Applied Materials is trading at a discount to the group. We can additionally observe that AMAT currently boasts a PEG ratio of 1.9. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Electronics - Semiconductors industry had an average PEG ratio of 1.98 as trading concluded yesterday. The Electronics - Semiconductors industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 55, putting it in the top 23% of all 250+ industries. The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these 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. Beyond Nvidia: AI's Second Wave Is HereThe AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. AI’s second wave is moving from infrastructure to implementation and these companies are at the forefront of this transition, positioned to become what Amazon and Google were to the internet era.See Stocks Now >>This article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks