Are Analysts Behind the Curve on Applied Materials?

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Applied Materials Inc. (NASDAQ: AMAT) reported its most recent quarterly results after the markets closed on Wednesday. The initial response to the report was not positive, but by Friday the stock had reached a new all-time high. While this was a relatively quiet all-time high, it begs the question of whether analysts are up to date on this stock.

Here 24/7 Wall St. has included some highlights from the earnings report, as well as what analysts are saying after the fact.

The chip giant said that it had $1.06 in earnings per share (EPS) and $4.2 billion in revenue, compared with consensus estimates from Thomson Reuters that called for $0.98 in EPS on revenue of $4.12 billion. The fiscal first quarter of last year reportedly had EPS of $0.67 on $3.28 billion in revenue.

As a result of the Tax Cuts and Jobs Act, the company recorded a $1.0 billion tax charge, which included an estimate of a one-time transition tax that is payable over eight years.

In the second quarter of fiscal 2018, Applied Materials expects net sales to be in the range of $4.35 billion to $4.55 billion. The midpoint of the range would be an increase of roughly 26% year over year. EPS is expected to be between $1.10 and $1.18, with the midpoint representing an increase of 44%, from last year.

The consensus estimates call for $1.14 in EPS on $4.45 billion in revenue for the fiscal second quarter.

Following the release of the earnings report, analysts raced to up their targets on the stock:

  • KeyCorp maintained its Overweight rating but raised its price target to $74 from $67.
  • Credit Suisse has an Outperform rating and raised its target to $74 from $72.
  • Stifel has a Buy rating and raised its price target from $66 to $71.
  • Susquehanna has a Positive rating and raised its target to $72 from $60.
  • Deutsche Bank has a Buy rating and raised its price target to $70 from $65.

Shares of Applied Materials were last seen at $55.o3, with a consensus analyst price target of $69.80 and a 52-week range of $34.72 to $60.89.

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