APPLIED MATERIALS INC (AMAT)
US0382221051 - Common Stock
Overall AMAT gets a fundamental rating of 7 out of 10. We evaluated AMAT against 107 industry peers in the Semiconductors & Semiconductor Equipment industry. AMAT gets an excellent profitability rating and is at the same time showing great financial health properties. AMAT is not valued too expensively and it also shows a decent growth rate. These ratings would make AMAT suitable for quality investing!
1. Profitability
1.1 Basic Checks
AMAT had positive earnings in the past year.
In the past year AMAT had a positive cash flow from operations.
In the past 5 years AMAT has always been profitable.
In the past 5 years AMAT always reported a positive cash flow from operatings.
1.2 Ratios
AMAT has a better Return On Assets (22.69%) than 96.23% of its industry peers.
With an excellent Return On Equity value of 41.07%, AMAT belongs to the best of the industry, outperforming 96.23% of the companies in the same industry.
With an excellent Return On Invested Capital value of 27.21%, AMAT belongs to the best of the industry, outperforming 97.17% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for AMAT is significantly above the industry average of 10.85%.
The 3 year average ROIC (31.98%) for AMAT is well above the current ROIC(27.21%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 22.69% | ||
| ROE | 41.07% | ||
| ROIC | 27.21% |
ROA(3y)23.18%
ROA(5y)19.99%
ROE(3y)47.84%
ROE(5y)42.14%
ROIC(3y)31.98%
ROIC(5y)27.48%
1.3 Margins
AMAT's Profit Margin of 27.03% is amongst the best of the industry. AMAT outperforms 87.74% of its industry peers.
In the last couple of years the Profit Margin of AMAT has grown nicely.
AMAT has a better Operating Margin (28.89%) than 87.74% of its industry peers.
AMAT's Operating Margin has been stable in the last couple of years.
AMAT has a Gross Margin (46.98%) which is in line with its industry peers.
In the last couple of years the Gross Margin of AMAT has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.89% | ||
| PM (TTM) | 27.03% | ||
| GM | 46.98% |
OM growth 3Y4.39%
OM growth 5Y1.38%
PM growth 3Y7.11%
PM growth 5Y7.29%
GM growth 3Y1.46%
GM growth 5Y0.75%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so AMAT is creating value.
The number of shares outstanding for AMAT has been reduced compared to 1 year ago.
AMAT has less shares outstanding than it did 5 years ago.
AMAT has a better debt/assets ratio than last year.
2.2 Solvency
AMAT has an Altman-Z score of 11.14. This indicates that AMAT is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 11.14, AMAT belongs to the top of the industry, outperforming 82.08% of the companies in the same industry.
The Debt to FCF ratio of AMAT is 0.74, which is an excellent value as it means it would take AMAT, only 0.74 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of AMAT (0.74) is better than 77.36% of its industry peers.
A Debt/Equity ratio of 0.32 indicates that AMAT is not too dependend on debt financing.
AMAT's Debt to Equity ratio of 0.32 is on the low side compared to the rest of the industry. AMAT is outperformed by 61.32% of its industry peers.
Even though the debt/equity ratio score it not favorable for AMAT, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | 0.74 | ||
| Altman-Z | 11.14 |
ROIC/WACC2.26
WACC12.06%
2.3 Liquidity
AMAT has a Current Ratio of 2.71. This indicates that AMAT is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of AMAT (2.71) is comparable to the rest of the industry.
A Quick Ratio of 1.91 indicates that AMAT should not have too much problems paying its short term obligations.
AMAT's Quick ratio of 1.91 is in line compared to the rest of the industry. AMAT outperforms 43.40% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.71 | ||
| Quick Ratio | 1.91 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 3.82% over the past year.
The Earnings Per Share has been growing by 12.59% on average over the past years. This is quite good.
AMAT shows a small growth in Revenue. In the last year, the Revenue has grown by 0.88%.
The Revenue has been growing by 9.68% on average over the past years. This is quite good.
EPS 1Y (TTM)3.82%
EPS 3Y24.42%
EPS 5Y12.59%
EPS growth Q2Q4.93%
Revenue 1Y (TTM)0.88%
Revenue growth 3Y15.52%
Revenue growth 5Y9.68%
Revenue growth Q2Q-0.47%
3.2 Future
AMAT is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.83% yearly.
AMAT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.83% yearly.
EPS Next Y4.67%
EPS Next 2Y9.96%
EPS Next 3Y10.96%
EPS Next 5Y10.83%
Revenue Next Year1.59%
Revenue Next 2Y6.16%
Revenue Next 3Y6.86%
Revenue Next 5Y5.83%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
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
The Price/Earnings ratio is 24.13, which indicates a rather expensive current valuation of AMAT.
Compared to the rest of the industry, the Price/Earnings ratio of AMAT indicates a somewhat cheap valuation: AMAT is cheaper than 68.87% of the companies listed in the same industry.
AMAT is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 24.67, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 20.20, which indicates a rather expensive current valuation of AMAT.
Based on the Price/Forward Earnings ratio, AMAT is valued a bit cheaper than the industry average as 76.42% of the companies are valued more expensively.
AMAT is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 21.02, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.13 | ||
| Fwd PE | 20.2 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, AMAT is valued a bit cheaper than 68.87% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, AMAT is valued cheaper than 84.91% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.2 | ||
| EV/EBITDA | 19.97 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates AMAT does not grow enough to justify the current Price/Earnings ratio.
AMAT has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)5.17
PEG (5Y)1.92
EPS Next 2Y9.96%
EPS Next 3Y10.96%
5. Dividend
5.1 Amount
AMAT has a yearly dividend return of 0.81%, which is pretty low.
Compared to an average industry Dividend Yield of 2.06, AMAT pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.81, AMAT pays less dividend than the S&P500 average, which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.81% |
5.2 History
On average, the dividend of AMAT grows each year by 14.27%, which is quite nice.
AMAT has been paying a dividend for at least 10 years, so it has a reliable track record.
AMAT has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)14.27%
Div Incr Years6
Div Non Decr Years18
5.3 Sustainability
AMAT pays out 14.26% of its income as dividend. This is a sustainable payout ratio.
AMAT's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP14.26%
EPS Next 2Y9.96%
EPS Next 3Y10.96%
APPLIED MATERIALS INC
NASDAQ:AMAT (5/1/2024, 2:48:08 PM)
196.64
-2.01 (-1.01%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap163.39B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.81% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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PT rev (1m)
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EPS NQ rev (1m)
EPS NQ rev (3m)
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EPS NY rev (3m)
Revenue NQ rev (1m)
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Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.13 | ||
| Fwd PE | 20.2 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)5.17
PEG (5Y)1.92
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 22.69% | ||
| ROE | 41.07% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 28.89% | ||
| PM (TTM) | 27.03% | ||
| GM | 46.98% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.84
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 2.71 | ||
| Quick Ratio | 1.91 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)3.82%
EPS 3Y24.42%
EPS 5Y
EPS growth Q2Q
EPS Next Y4.67%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)0.88%
Revenue growth 3Y15.52%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y