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U.S. export license extensions have limited large-scale shipments of advanced chipmaking tools to China, affecting Applied Materials and peers.
These policy changes have led to order postponements and shorter term uncertainty around some China related demand.
At the same time, Applied Materials is seeing strong interest in its equipment as chipmakers invest to support AI and next generation computing needs.
Applied Materials, traded as NasdaqGS:AMAT, sits at the center of this tension between export controls and demand for high end chip equipment. The share price is $297.6, with a 1 year return of 66.4% and a 3 year return of 163.7%. This reflects how closely investors track its role in semiconductor spending cycles.
For you as an investor, the key question is how well the company can offset delayed China related orders with demand in other regions and end markets linked to AI and advanced computing. The recent 11.6% decline over the past week, compared with a 10.7% gain year to date and a 193.5% return over 5 years, shows how quickly sentiment can shift as policy headlines and long term demand themes intersect.
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NasdaqGS:AMAT 1-Year Stock Price Chart
NasdaqGS:AMAT 1-Year Stock Price Chart
Is Applied Materials financially strong enough to weather the next crisis?
Quick Assessment
⚖️ Price vs Analyst Target: At US$297.60, the share price is about 9% below the US$328.55 analyst target, suggesting it is close to consensus but with some upside implied.
❌ Simply Wall St Valuation: The shares are trading 111.7% above the estimated fair value, which flags a stretched valuation on this model.
✅ Recent Momentum: The 30 day return of about 4.7% shows positive short term momentum despite export control headlines.
Check out Simply Wall St’s in depth valuation analysis for Applied Materials.
Key Considerations
📊 US China export restrictions can delay part of the order book, so you may want to judge how AI related demand in other regions offsets this.
📊 Keep an eye on bookings by geography, AI linked equipment orders and the P/E of 33.8x versus the Semiconductor industry average of 40.4x.
⚠️ One flagged risk is significant insider selling over the past 3 months, which some investors treat as a caution signal when valuations are rich.
Dig Deeper
For the full picture including more risks and rewards, check out the complete Applied Materials analysis.