AMAT stock on edge ahead of earnings: what next for Applied Materials?

Applied Materials stock price has been in a strong bull run and is trading near its record high.

AMAT was trading at $431, a few points lower than the record high of $447.

It has soared by 156% in the last 12 months and 275% in the last five years. 

Analysts are upbeat about AMAT stock ahead of earnings

Applied Materials, a company that supplies essential products to semiconductor manufacturers, will be in the spotlight this week as it releases its financial results. 

Wall Street analysts are highly bullish about the company, especially after Elon Musk tapped it for its terafab product.

In a statement, Atif Malik, a Citi analyst, boosted his target from $420 to $450, pointing to strong revenue and profit growth. He said:

“We increase CY27 silicon revenue to 31% Y/Y growth and lift EPS by 12% to $15.72. Moreover, AMAT stock multiple has expanded from 23x to 27x YTD on improved execution and favorable end market (DRAM and F/L) spend mix in 2026/27.”

Other Wall Street analysts have boosted their AMAT stock price forecast this year as companies continued to boost their capital spending.

In a note this week, Cantor Fitzgerald’s C.J Mose hiked his target to $550 from the previous $500. He expects the company to release strong numbers and margins. 

HSBC’s Adithya Metuku placed a target of $517, while UBS boosted to $480 from the previous $430.

The average estimate has been rising in the past few months, moving to $384 today from $203 a year earlier. 

Applied Materials business is doing well

Wall Street analysts are optimistic that the company will continue growing, helped by the robust AI spending.

This is notable as the company is a top supplier to some of the top AI fab firms in the world, like Samsung, TSMC, and GlobalFoundries. 

The average estimate among analysts is that its revenue will come in at $7.69 billion, up by 8.32% YoY.

Based on its recent history, the company will likely publish stronger-than-expected results. In this case, its revenue will likely come in at over $7.8 billion.

Applied Materials’ annual revenue is expected to jump by 11% this year to $31.5 billion.

It will then jump by 21.3% next year to over $38.2 billion, with its earnings-per-share hitting $14.3.

This growth will likely keep surging as top hyperscalers boost their spending to over $725 billion this year. 

Still, there are concerns that the AMAT stock is relatively overpriced.

It has a forward price-to-earnings ratio of 40, almost double that of NVIDIA’s 23. It is also much higher than the S&P 500 Index’s 21.

Applied Materials stock price forecast

AMAT stock chart | Source: TradingView

The daily chart shows that the AMAT share price has been in a strong uptrend in the past few years and is now near its all-time high. It peaked at nearly $450 to the current $430. 

The stock continues being supported by the 50-day and 100-day moving averages, which have provided it with substantial support. 

At the same time, Applied Materials shares have formed a small abandoned baby candlestick pattern.

The Relative Strength Index (RSI) has also formed a symmetrical triangle pattern.

It has also formed a rising wedge pattern.

Therefore, while the stock will likely continue rising, there is a risk that it will pull back when it releases its results. Eventually, chances are that it will jump to over $500 later this year.