Key insights
- The author is contemplating purchasing AMAT, highlighting its past growth and attractive valuation based on future revenue forecasts. Concerns exist regarding its high P/E ratio and whether the stock's growth is sustainable. Recent positive catalysts include strong earnings, increased dividends, and resolution of a federal investigation. Overall, the sentiment leans bullish, suggesting a slightly positive influence on the US market due to potential investor interest in AMAT and the semiconductor sector.
AMAT has gone up 200% in the past 5 years and 130% in the past year. Yet its estimated evaluation is somewhere between 416-450, which still gives about a 16% growth even just for this year, and that seems pretty attractive. It’s PE ratio though is around 35x which seems quite high, but on its last earnings report it did significantly beat the EPS as well as the expected revenue, with a pretty good increase in revenue expectations and forecast for 2026. It also had increased its dividend as well. It seems that it is an attractive purchase at its current pricing, but I do worry about the already explosive growth and I wonder if it’s towards the end of its hype. At the same time, it was able to resolve the federal investigation recently which should be…bullish?
I would love to hear what people’s thoughts are regarding AMAT and whether it is at a good purchasing price still.