APPLIED MATERIALS INC (AMAT) Stock Fundamental Analysis
USA - NASDAQ:AMAT - US0382221051 - Common Stock
224.99 USD
-2.73 (-1.2%)
226.26 USD
+1.27 (+0.56%)
Taking everything into account, AMAT scores 7 out of 10 in our fundamental rating. AMAT was compared to 112 industry peers in the Semiconductors & Semiconductor Equipment industry. AMAT scores excellent points on both the profitability and health parts. This is a solid base for a good stock. AMAT has a decent growth rate and is not valued too expensively. This makes AMAT very considerable 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
Looking at the Return On Assets, with a value of 19.97%, AMAT belongs to the top of the industry, outperforming 91.07% of the companies in the same industry.
AMAT has a better Return On Equity (35.03%) than 92.86% of its industry peers.
The Return On Invested Capital of AMAT (28.12%) is better than 96.43% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for AMAT is significantly above the industry average of 10.98%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 19.97% | ||
| ROE | 35.03% | ||
| ROIC | 28.12% |
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
AMAT has a Profit Margin of 23.88%. This is amongst the best in the industry. AMAT outperforms 85.71% of its industry peers.
In the last couple of years the Profit Margin of AMAT has grown nicely.
AMAT has a Operating Margin of 30.14%. This is amongst the best in the industry. AMAT outperforms 90.18% of its industry peers.
In the last couple of years the Operating Margin of AMAT has grown nicely.
Looking at the Gross Margin, with a value of 48.50%, AMAT is in line with its industry, outperforming 59.82% of the companies in the same industry.
AMAT's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 30.14% | ||
| PM (TTM) | 23.88% | ||
| GM | 48.5% |
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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), AMAT is creating value.
AMAT has less shares outstanding than it did 1 year ago.
The number of shares outstanding for AMAT has been reduced compared to 5 years ago.
Compared to 1 year ago, AMAT has an improved debt to assets ratio.
2.2 Solvency
AMAT has an Altman-Z score of 11.59. 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 11.59, AMAT is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
The Debt to FCF ratio of AMAT is 1.08, which is an excellent value as it means it would take AMAT, only 1.08 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.08, AMAT is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
AMAT has a Debt/Equity ratio of 0.32. This is a healthy value indicating a solid balance between debt and equity.
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 62.50% 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 | 1.08 | ||
| Altman-Z | 11.59 |
ROIC/WACC2.44
WACC11.52%
2.3 Liquidity
AMAT has a Current Ratio of 2.50. This indicates that AMAT is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 2.50, AMAT is in line with its industry, outperforming 41.96% of the companies in the same industry.
A Quick Ratio of 1.79 indicates that AMAT should not have too much problems paying its short term obligations.
The Quick ratio of AMAT (1.79) is worse than 60.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.5 | ||
| Quick Ratio | 1.79 |
3. Growth
3.1 Past
AMAT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 13.12%, which is quite good.
The Earnings Per Share has been growing by 23.21% on average over the past years. This is a very strong growth
The Revenue has been growing slightly by 6.55% in the past year.
AMAT shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 13.22% yearly.
EPS 1Y (TTM)13.12%
EPS 3Y8.08%
EPS 5Y23.21%
EPS Q2Q%16.98%
Revenue 1Y (TTM)6.55%
Revenue growth 3Y5.62%
Revenue growth 5Y13.22%
Sales Q2Q%7.73%
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 10.71% yearly.
The Revenue is expected to grow by 7.44% on average over the next years.
EPS Next Y10.13%
EPS Next 2Y6.15%
EPS Next 3Y8.45%
EPS Next 5Y10.71%
Revenue Next Year4.39%
Revenue Next 2Y3.78%
Revenue Next 3Y5.5%
Revenue Next 5Y7.44%
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
Based on the Price/Earnings ratio of 23.51, the valuation of AMAT can be described as rather expensive.
Compared to the rest of the industry, the Price/Earnings ratio of AMAT indicates a rather cheap valuation: AMAT is cheaper than 83.04% 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 27.42, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 23.06, AMAT is valued on the expensive side.
75.89% of the companies in the same industry are more expensive than AMAT, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.94, AMAT is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.51 | ||
| Fwd PE | 23.06 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, AMAT is valued a bit cheaper than 74.11% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, AMAT is valued a bit cheaper than 78.57% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.78 | ||
| EV/EBITDA | 19.45 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of AMAT may justify a higher PE ratio.
PEG (NY)2.32
PEG (5Y)1.01
EPS Next 2Y6.15%
EPS Next 3Y8.45%
5. Dividend
5.1 Amount
AMAT has a yearly dividend return of 0.81%, which is pretty low.
AMAT's Dividend Yield is rather good when compared to the industry average which is at 2.13. AMAT pays more dividend than 81.25% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.36, AMAT's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.81% |
5.2 History
The dividend of AMAT is nicely growing with an annual growth rate of 12.01%!
AMAT has paid a dividend for at least 10 years, which is a reliable track record.
AMAT has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)12.01%
Div Incr Years7
Div Non Decr Years19
5.3 Sustainability
AMAT pays out 19.73% of its income as dividend. This is a sustainable payout ratio.
The dividend of AMAT is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP19.73%
EPS Next 2Y6.15%
EPS Next 3Y8.45%
224.99
-2.73 (-1.2%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners82.9%
Inst Owner Change-0.49%
Ins Owners0.26%
Ins Owner Change-0.05%
Market Cap179.24B
Analysts77.56
Price Target200.62 (-10.83%)
Short Float %2.51%
Short Ratio2.49
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.81% |
Yearly Dividend1.44
Dividend Growth(5Y)12.01%
DP19.73%
Div Incr Years7
Div Non Decr Years19
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.16%
Min EPS beat(2)1.29%
Max EPS beat(2)3.04%
EPS beat(4)4
Avg EPS beat(4)2.57%
Min EPS beat(4)1.29%
Max EPS beat(4)3.84%
EPS beat(8)8
Avg EPS beat(8)3.7%
EPS beat(12)12
Avg EPS beat(12)5.12%
EPS beat(16)13
Avg EPS beat(16)3.76%
Revenue beat(2)0
Avg Revenue beat(2)-1.61%
Min Revenue beat(2)-2.34%
Max Revenue beat(2)-0.88%
Revenue beat(4)0
Avg Revenue beat(4)-1.38%
Min Revenue beat(4)-2.34%
Max Revenue beat(4)-0.68%
Revenue beat(8)2
Avg Revenue beat(8)-0.45%
Revenue beat(12)5
Avg Revenue beat(12)0.17%
Revenue beat(16)6
Avg Revenue beat(16)-0.36%
PT rev (1m)1.45%
PT rev (3m)-2.06%
EPS NQ rev (1m)-0.51%
EPS NQ rev (3m)-11.35%
EPS NY rev (1m)-0.14%
EPS NY rev (3m)-1.39%
Revenue NQ rev (1m)-0.37%
Revenue NQ rev (3m)-8.81%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)-1.77%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.51 | ||
| Fwd PE | 23.06 | ||
| P/S | 6.26 | ||
| P/FCF | 30.78 | ||
| P/OCF | 23.26 | ||
| P/B | 9.19 | ||
| P/tB | 11.55 | ||
| EV/EBITDA | 19.45 |
EPS(TTM)9.57
EY4.25%
EPS(NY)9.76
Fwd EY4.34%
FCF(TTM)7.31
FCFY3.25%
OCF(TTM)9.67
OCFY4.3%
SpS35.92
BVpS24.48
TBVpS19.48
PEG (NY)2.32
PEG (5Y)1.01
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 19.97% | ||
| ROE | 35.03% | ||
| ROCE | 32.75% | ||
| ROIC | 28.12% | ||
| ROICexc | 37.92% | ||
| ROICexgc | 47.29% | ||
| OM | 30.14% | ||
| PM (TTM) | 23.88% | ||
| GM | 48.5% | ||
| FCFM | 20.35% |
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-Score7
Asset Turnover0.84
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | 1.08 | ||
| Debt/EBITDA | 0.69 | ||
| Cap/Depr | 436.66% | ||
| Cap/Sales | 6.58% | ||
| Interest Coverage | 36.08 | ||
| Cash Conversion | 85.1% | ||
| Profit Quality | 85.23% | ||
| Current Ratio | 2.5 | ||
| Quick Ratio | 1.79 | ||
| Altman-Z | 11.59 |
F-Score7
WACC11.52%
ROIC/WACC2.44
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)13.12%
EPS 3Y8.08%
EPS 5Y23.21%
EPS Q2Q%16.98%
EPS Next Y10.13%
EPS Next 2Y6.15%
EPS Next 3Y8.45%
EPS Next 5Y10.71%
Revenue 1Y (TTM)6.55%
Revenue growth 3Y5.62%
Revenue growth 5Y13.22%
Sales Q2Q%7.73%
Revenue Next Year4.39%
Revenue Next 2Y3.78%
Revenue Next 3Y5.5%
Revenue Next 5Y7.44%
EBIT growth 1Y10.66%
EBIT growth 3Y3%
EBIT growth 5Y18.52%
EBIT Next Year14.33%
EBIT Next 3Y8.79%
EBIT Next 5Y7.47%
FCF growth 1Y-16.6%
FCF growth 3Y16.18%
FCF growth 5Y21.69%
OCF growth 1Y-3.71%
OCF growth 3Y16.83%
OCF growth 5Y21.72%