APPLIED MATERIALS INC (1AMAT.MI) Stock Fundamental Analysis
BIT:1AMAT - Euronext Milan - US0382221051 - Common Stock - Currency: EUR
We assign a fundamental rating of 7 out of 10 to 1AMAT. 1AMAT was compared to 52 industry peers in the Semiconductors & Semiconductor Equipment industry. 1AMAT has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. 1AMAT is not valued too expensively and it also shows a decent growth rate. These ratings would make 1AMAT suitable for quality investing!
1. Profitability
1.1 Basic Checks
In the past year 1AMAT was profitable.
1AMAT had a positive operating cash flow in the past year.
1AMAT had positive earnings in each of the past 5 years.
In the past 5 years 1AMAT always reported a positive cash flow from operatings.
1.2 Ratios
1AMAT has a Return On Assets of 19.03%. This is amongst the best in the industry. 1AMAT outperforms 88.46% of its industry peers.
The Return On Equity of 1AMAT (34.06%) is better than 80.77% of its industry peers.
1AMAT has a Return On Invested Capital of 27.05%. This is amongst the best in the industry. 1AMAT outperforms 94.23% of its industry peers.
The Average Return On Invested Capital over the past 3 years for 1AMAT is significantly above the industry average of 15.85%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 19.03% | ||
| ROE | 34.06% | ||
| ROIC | 27.05% |
ROA(3y)22.53%
ROA(5y)21.31%
ROE(3y)44.41%
ROE(5y)43.1%
ROIC(3y)30.16%
ROIC(5y)28.95%
1.3 Margins
1AMAT has a better Profit Margin (22.95%) than 71.15% of its industry peers.
1AMAT's Profit Margin has improved in the last couple of years.
1AMAT has a better Operating Margin (29.22%) than 73.08% of its industry peers.
In the last couple of years the Operating Margin of 1AMAT has grown nicely.
With a Gross Margin value of 47.73%, 1AMAT perfoms like the industry average, outperforming 55.77% of the companies in the same industry.
1AMAT's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 29.22% | ||
| PM (TTM) | 22.95% | ||
| GM | 47.73% |
OM growth 3Y-2.49%
OM growth 5Y4.68%
PM growth 3Y1.14%
PM growth 5Y7.35%
GM growth 3Y0.09%
GM growth 5Y1.66%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so 1AMAT is creating value.
1AMAT has less shares outstanding than it did 1 year ago.
The number of shares outstanding for 1AMAT has been reduced compared to 5 years ago.
Compared to 1 year ago, 1AMAT has an improved debt to assets ratio.
2.2 Solvency
1AMAT has an Altman-Z score of 9.10. This indicates that 1AMAT is financially healthy and has little risk of bankruptcy at the moment.
1AMAT has a Altman-Z score of 9.10. This is amongst the best in the industry. 1AMAT outperforms 86.54% of its industry peers.
1AMAT has a debt to FCF ratio of 1.05. This is a very positive value and a sign of high solvency as it would only need 1.05 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.05, 1AMAT is in the better half of the industry, outperforming 78.85% of the companies in the same industry.
A Debt/Equity ratio of 0.34 indicates that 1AMAT is not too dependend on debt financing.
1AMAT has a Debt to Equity ratio of 0.34. This is in the lower half of the industry: 1AMAT underperforms 61.54% of its industry peers.
Although 1AMAT does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.34 | ||
| Debt/FCF | 1.05 | ||
| Altman-Z | 9.1 |
ROIC/WACC2.87
WACC9.44%
2.3 Liquidity
A Current Ratio of 2.68 indicates that 1AMAT has no problem at all paying its short term obligations.
1AMAT's Current ratio of 2.68 is fine compared to the rest of the industry. 1AMAT outperforms 65.38% of its industry peers.
1AMAT has a Quick Ratio of 1.96. This is a normal value and indicates that 1AMAT is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of 1AMAT (1.96) is better than 63.46% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.68 | ||
| Quick Ratio | 1.96 |
3. Growth
3.1 Past
1AMAT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 9.33%, which is quite good.
Measured over the past years, 1AMAT shows a very strong growth in Earnings Per Share. The EPS has been growing by 23.21% on average per year.
The Revenue has been growing slightly by 4.34% in the past year.
The Revenue has been growing by 13.22% on average over the past years. This is quite good.
EPS 1Y (TTM)9.33%
EPS 3Y8.08%
EPS 5Y23.21%
EPS Q2Q%11.74%
Revenue 1Y (TTM)4.34%
Revenue growth 3Y5.62%
Revenue growth 5Y13.22%
Sales Q2Q%6.84%
3.2 Future
The Earnings Per Share is expected to grow by 10.23% on average over the next years. This is quite good.
1AMAT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.14% yearly.
EPS Next Y9.67%
EPS Next 2Y8.81%
EPS Next 3Y8.91%
EPS Next 5Y10.23%
Revenue Next Year6.22%
Revenue Next 2Y6.25%
Revenue Next 3Y6.47%
Revenue Next 5Y7.14%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 17.48 indicates a rather expensive valuation of 1AMAT.
Based on the Price/Earnings ratio, 1AMAT is valued a bit cheaper than the industry average as 69.23% of the companies are valued more expensively.
1AMAT is valuated rather cheaply when we compare the Price/Earnings ratio to 28.10, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 15.20, which indicates a correct valuation of 1AMAT.
1AMAT's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. 1AMAT is cheaper than 71.15% of the companies in the same industry.
1AMAT is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 20.74, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.48 | ||
| Fwd PE | 15.2 |
4.2 Price Multiples
1AMAT's Enterprise Value to EBITDA ratio is in line with the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of 1AMAT indicates a rather cheap valuation: 1AMAT is cheaper than 84.62% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.34 | ||
| EV/EBITDA | 13.58 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates 1AMAT does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of 1AMAT may justify a higher PE ratio.
PEG (NY)1.81
PEG (5Y)0.75
EPS Next 2Y8.81%
EPS Next 3Y8.91%
5. Dividend
5.1 Amount
1AMAT has a Yearly Dividend Yield of 1.23%.
In the last 3 months the price of 1AMAT has falen by -28.40%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
1AMAT's Dividend Yield is a higher than the industry average which is at 1.48.
Compared to an average S&P500 Dividend Yield of 2.43, 1AMAT's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.23% |
5.2 History
The dividend of 1AMAT is nicely growing with an annual growth rate of 12.01%!
Dividend Growth(5Y)12.01%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
19.74% of the earnings are spent on dividend by 1AMAT. This is a low number and sustainable payout ratio.
The dividend of 1AMAT is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP19.74%
EPS Next 2Y8.81%
EPS Next 3Y8.91%
BIT:1AMAT (5/5/2025, 7:00:00 PM)
137.42
+7.36 (+5.66%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners83.81%
Inst Owner ChangeN/A
Ins Owners0.02%
Ins Owner ChangeN/A
Market Cap111.65B
Analysts80
Price Target179.56 (30.67%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.23% |
Yearly Dividend1.27
Dividend Growth(5Y)12.01%
DP19.74%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.97%
Min EPS beat(2)2.11%
Max EPS beat(2)3.84%
EPS beat(4)4
Avg EPS beat(4)2.92%
Min EPS beat(4)2.11%
Max EPS beat(4)3.84%
EPS beat(8)8
Avg EPS beat(8)4.87%
EPS beat(12)11
Avg EPS beat(12)4.88%
EPS beat(16)13
Avg EPS beat(16)4.17%
Revenue beat(2)0
Avg Revenue beat(2)-1.15%
Min Revenue beat(2)-1.62%
Max Revenue beat(2)-0.68%
Revenue beat(4)0
Avg Revenue beat(4)-0.76%
Min Revenue beat(4)-1.62%
Max Revenue beat(4)-0.31%
Revenue beat(8)4
Avg Revenue beat(8)0.48%
Revenue beat(12)6
Avg Revenue beat(12)0.25%
Revenue beat(16)8
Avg Revenue beat(16)0.06%
PT rev (1m)-11.66%
PT rev (3m)-13.27%
EPS NQ rev (1m)-0.07%
EPS NQ rev (3m)-1.26%
EPS NY rev (1m)-0.17%
EPS NY rev (3m)-1.79%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.38%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)-2.04%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.48 | ||
| Fwd PE | 15.2 | ||
| P/S | 4.58 | ||
| P/FCF | 21.34 | ||
| P/OCF | 17.4 | ||
| P/B | 6.8 | ||
| P/tB | 8.66 | ||
| EV/EBITDA | 13.58 |
EPS(TTM)7.86
EY5.72%
EPS(NY)9.04
Fwd EY6.58%
FCF(TTM)6.44
FCFY4.69%
OCF(TTM)7.9
OCFY5.75%
SpS29.99
BVpS20.21
TBVpS15.86
PEG (NY)1.81
PEG (5Y)0.75
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 19.03% | ||
| ROE | 34.06% | ||
| ROCE | 31.54% | ||
| ROIC | 27.05% | ||
| ROICexc | 39.27% | ||
| ROICexgc | 50.36% | ||
| OM | 29.22% | ||
| PM (TTM) | 22.95% | ||
| GM | 47.73% | ||
| FCFM | 21.48% |
ROA(3y)22.53%
ROA(5y)21.31%
ROE(3y)44.41%
ROE(5y)43.1%
ROIC(3y)30.16%
ROIC(5y)28.95%
ROICexc(3y)39.77%
ROICexc(5y)39.3%
ROICexgc(3y)51.88%
ROICexgc(5y)52.37%
ROCE(3y)34.44%
ROCE(5y)32.94%
ROICexcg growth 3Y-7.9%
ROICexcg growth 5Y3.47%
ROICexc growth 3Y-6.23%
ROICexc growth 5Y6.64%
OM growth 3Y-2.49%
OM growth 5Y4.68%
PM growth 3Y1.14%
PM growth 5Y7.35%
GM growth 3Y0.09%
GM growth 5Y1.66%
F-Score6
Asset Turnover0.83
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.34 | ||
| Debt/FCF | 1.05 | ||
| Debt/EBITDA | 0.74 | ||
| Cap/Depr | 330.54% | ||
| Cap/Sales | 4.86% | ||
| Interest Coverage | 36.21 | ||
| Cash Conversion | 85.8% | ||
| Profit Quality | 93.57% | ||
| Current Ratio | 2.68 | ||
| Quick Ratio | 1.96 | ||
| Altman-Z | 9.1 |
F-Score6
WACC9.44%
ROIC/WACC2.87
Cap/Depr(3y)231.86%
Cap/Depr(5y)195.47%
Cap/Sales(3y)3.87%
Cap/Sales(5y)3.39%
Profit Quality(3y)95.26%
Profit Quality(5y)92.06%
High Growth Momentum
Growth
EPS 1Y (TTM)9.33%
EPS 3Y8.08%
EPS 5Y23.21%
EPS Q2Q%11.74%
EPS Next Y9.67%
EPS Next 2Y8.81%
EPS Next 3Y8.91%
EPS Next 5Y10.23%
Revenue 1Y (TTM)4.34%
Revenue growth 3Y5.62%
Revenue growth 5Y13.22%
Sales Q2Q%6.84%
Revenue Next Year6.22%
Revenue Next 2Y6.25%
Revenue Next 3Y6.47%
Revenue Next 5Y7.14%
EBIT growth 1Y5.54%
EBIT growth 3Y3%
EBIT growth 5Y18.52%
EBIT Next Year15.2%
EBIT Next 3Y10.02%
EBIT Next 5Y6.98%
FCF growth 1Y45.43%
FCF growth 3Y16.18%
FCF growth 5Y21.69%
OCF growth 1Y45.22%
OCF growth 3Y16.83%
OCF growth 5Y21.72%