QualityDipStocks / Technology · Semiconductors
Applied Materials AMAT
In a deep dip: 46% below its 52-week high.
A quality company trading well above our fair value estimate.
- Fair value est.
- $112.86−71%
- Market Value
- forming
- Off 52-wk high
- −46%
- Risk vs market
- Highbeta 2.80
5 bullish · 5 bearish See why
Key levels
Every level vs today’s $390.09
- Fair value est.base case$112.86−71.1%
- 52-wk lowlowest close, 1 year$220.23−43.5%
- PriceFri Oct 30 close$390.09you are here
- 52-wk highhighest close, 1 year$723.00+85.3%
Fair value estimate
How the range is computed
Ten-year free-cash-flow DCF. Same 10-year free-cash-flow model as the base: discount rate 9.5% ±1 point and growth 3.2% ±2 points. Bear = 10.5% and 1.2%; bull = 8.5% and 5.2% (both fade to 3%). A model estimate from public filings, not a forecast of where the price will go.
Price is above even the bull case.
What the price implies To be worth today’s price, AMAT’s free cash flow would need to grow about 26% a year for five years; our estimate uses 3%.
Risk vs market
How risk vs market is measured
One year of daily returns (Oct 30 to Oct 30, 252 sessions). Beta = how much AMAT moved for each 1% move in the S&P 500 (SPY); 1.0 moves with the market. Volatility is the yearly standard deviation of daily returns. Past behavior, not a forecast.
Swings much more than the market, and its own price swings are 4.8× the S&P 500’s.
- Beta vs S&P 500
- 2.80
- Volatility
- 61% vs 13% SPY
- Correlation SPY
- 0.59
- Correlation QQQ
- 0.73
Bull vs bear
Rule-based from the data on this page, strongest first. Not advice.
Top bullish points 5 of 5
ProfitabilityReturn on equity of 41% over the last 12 months.
ProfitabilityReturn on invested capital of 33%, above the 9.5% discount rate our DCF uses.
ProfitabilityOperating margin of 30% over the last 12 months.
TechnicalA company that passes our quality screen, now 46% off its 52-week high (deep dip).
QualityPasses all four of our quality checks: cash generation, returns on capital, growth and balance sheet.
Top bearish points 5 of 5
ValuationOur DCF fair value estimate is $112.86, 71% below the price.
ValuationP/E of 33.7× is 57% above its own average of 21.4× at the last 3 fiscal year-ends.
ProfitabilityReturn on equity fell 8 points in two fiscal years, to 34% in FY2025.
RiskSwings hard: beta 2.80 vs the S&P 500 and 61% yearly volatility (SPY 13%).
RiskReports earnings Nov 12 (consensus EPS $4.06): results can move the price sharply and reset Market Value.
Who’s talking about it
Notable investors, executives, analysts and public figures on Applied Materials in the last 48 hours. Headlines as published, each linked. Their words, not ours.
No notable mentions in the last 48 hours. Checked Nov 1, 9:09 PM ET.
Compare with peers
Closest in size in Semiconductors
All fundamentals
P/E 33.7 · FCF yield 1.8% · ROE 41%
Valuation
- P/E
- 33.7×3-yr-end avg 21.4× · Technology median 33.9×
- Price / FCF
- 55.5×
- FCF yield
- 1.8%
- EV / EBITDA
- 32.1×
- Price / sales
- 10.12×
- Price / book
- 12.18×
- Market cap
- $312Bprice × diluted shares
- Enterprise value
- $311B
Growth
- Revenue, 12 months
- $30.8B
- Sales growth, 12 months
- +7.8%vs the 12 months before
- Sales growth, 3 yrs
- +3.2%/yrfrom FY2022
- Diluted EPS, 12 months
- $11.59
- EPS growth, last FY
- +0.6%
- Net income, 12 months
- $9.3B
- Net income growth
- +36%12 months vs before
Profitability
- Gross margin
- 49.4%
- Operating margin
- 29.6%
- Net margin
- 30.1%
- FCF margin
- 18.2%
- Return on equity
- 41%
- Return on invested capital
- 33%
Balance sheet
- Cash & short-term inv.
- $9.2B
- Total debt
- $7.7B
- Net cash
- $1.5B
- Debt / equity
- 0.30×
- Interest coverage
- 33.0×operating income / interest
Cash flow & returns
- Free cash flow, 12 months
- $5.6B
- FCF growth, 12 months
- −3%
- Dividend yield
- 0.49%$1.5B paid
- Payout ratio
- 16%
- Buybacks, 12 months
- $2.0B0.6% of market cap
- Share count, 1 year
- −0.2%diluted shares vs a year ago
- Stock-based comp
- $701M
Trailing 12 months to Jul 26, 2026; balance sheet at Jul 26, 2026. From Applied Materials’s SEC filings. Sparklines show up to six fiscal years. n/a means we don’t hold that number, with the reason. How each is computed.
Valuation details
DCF $112.86 · MV $404.30 · FCF value $175.72
Assumes 3.2% growth for 5 years (revenue grew 3.2% a year FY22–FY25), fading to 3%; 9.5% discount rate, 3% terminal growth. FCF base $7.03 a share, trailing 12 months to Jul 31, 2026 (company filings via Yahoo Finance, checked against SEC).
How we got these
- Market Value: volume-weighted average close from Oct 27 (first full trading day after the filing) to Oct 30, 4 trading days. Simple average $405.92. Event: SEC 8-K Item 8.01 (major announcement), filed Oct 26, 4:34 PM ET. Read the filing.
- Free cash flow, 12 months to Jul 31: $8.4B operating cash flow − $2.8B capex = $5.6B, or $7.03 a share on 0.80B diluted shares.
- DCF: free cash flow per share grows 3% a year for five years, from its FY2022–FY2025 revenue growth of 3% a year, fading to 3% by year ten; 9.5% discount rate, 3% terminal growth.
- FCF value: free cash flow per share ÷ 4%, the price at which the stock yields 4% in free cash flow.
Setup & signals
No setup armed
No setup armed, so there’s no trigger or stop to track yet. We watch it daily for our three reversal signal rules while it sits in a dip.
Momentum & 52-week range
RSI 36 · 5 days +3.4%
The business
FCF $5.6B · Sales +25%
- Free cash flow, 12 months$5.6B
- Free-cash-flow yield1.7%
- Free-cash-flow margin18%
- Gross margin49%
- Operating margin31%
- Return on invested capital24%
- Return on equity42%
- Sales growth (latest quarter vs year-ago quarter)+25%
- Net debt / EBITDA0.0×
Next report
Nov 12
- DateThu Nov 12, after the close
- Consensus EPS$4.06
- Year-ago EPS$2.17
- QuarterOct/2026
From Nasdaq’s earnings calendar. A report resets Market Value.
Information only, not investment advice. Fair value estimates and talking points are rule-based model output from public data and can be wrong; stop levels are reference points, not orders. How every number is computed.
Get a text when AMAT fires a reversal signal
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