In the latest trading session, Applied Materials (AMAT) closed at $138.45, marking a +0.17% move from the previous day. This change outpaced the S&P 500's 0.27% loss on the day. Elsewhere, the Dow lost 0.47%, while the tech-heavy Nasdaq added 0.14%.
Coming into today, shares of the maker of chipmaking equipment had lost 9.52% in the past month. In that same time, the Computer and Technology sector lost 2.58%, while the S&P 500 lost 2.86%.
Wall Street will be looking for positivity from Applied Materials as it approaches its next earnings report date. On that day, Applied Materials is projected to report earnings of $1.98 per share, which would represent a year-over-year decline of 2.46%. Meanwhile, our latest consensus estimate is calling for revenue of $6.52 billion, down 3.33% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $7.90 per share and revenue of $26.32 billion. These totals would mark changes of +2.6% and +2.07%, respectively, from last year.
Investors might also notice recent changes to analyst estimates for Applied Materials. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.42% higher. Applied Materials is currently sporting a Zacks Rank of #2 (Buy).
Investors should also note Applied Materials's current valuation metrics, including its Forward P/E ratio of 17.5. This valuation marks a discount compared to its industry's average Forward P/E of 22.45.
Also, we should mention that AMAT has a PEG ratio of 2.87. 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. Semiconductor Equipment - Wafer Fabrication stocks are, on average, holding a PEG ratio of 2.87 based on yesterday's closing prices.
The Semiconductor Equipment - Wafer Fabrication industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 34, which puts it in the top 14% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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