APPLIED MATERIALS INC (AMAT) Stock Fundamental Analysis
USA - NASDAQ:AMAT - US0382221051 - Common Stock
173.54 USD
+2.61 (+1.53%)
173.55 USD
+0.01 (+0.01%)
AMAT gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 112 industry peers in the Semiconductors & Semiconductor Equipment industry. Both the health and profitability get an excellent rating, making AMAT a very profitable company, without any liquidiy or solvency issues. 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
In the past year AMAT was profitable.
AMAT had a positive operating cash flow in the past year.
Each year in the past 5 years AMAT has been profitable.
In the past 5 years AMAT always reported a positive cash flow from operatings.
1.2 Ratios
AMAT's Return On Assets of 19.97% is amongst the best of the industry. AMAT outperforms 91.96% of its industry peers.
The Return On Equity of AMAT (35.03%) is better than 92.86% of its industry peers.
Looking at the Return On Invested Capital, with a value of 28.12%, AMAT belongs to the top of the industry, outperforming 96.43% of the companies in the same industry.
AMAT had an Average Return On Invested Capital over the past 3 years of 30.16%. This is significantly above the industry average of 10.87%.
| 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
With an excellent Profit Margin value of 23.88%, AMAT belongs to the best of the industry, outperforming 85.71% of the companies in the same industry.
In the last couple of years the Profit Margin of AMAT has grown nicely.
The Operating Margin of AMAT (30.14%) is better than 90.18% of its industry peers.
AMAT's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 48.50%, AMAT perfoms like the industry average, outperforming 59.82% of the companies in the same industry.
In the last couple of years the Gross Margin of AMAT has grown nicely.
| 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.
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.
Compared to 1 year ago, AMAT has an improved debt to assets ratio.
2.2 Solvency
AMAT has an Altman-Z score of 9.92. This indicates that AMAT is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of AMAT (9.92) is better than 75.89% of its industry peers.
AMAT has a debt to FCF ratio of 1.08. This is a very positive value and a sign of high solvency as it would only need 1.08 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 1.08, AMAT is doing good in the industry, outperforming 74.11% of the companies in the same industry.
A Debt/Equity ratio of 0.32 indicates that AMAT is not too dependend on debt financing.
AMAT has a Debt to Equity ratio of 0.32. This is in the lower half of the industry: AMAT underperforms 64.29% 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 | 9.92 |
ROIC/WACC2.49
WACC11.27%
2.3 Liquidity
A Current Ratio of 2.50 indicates that AMAT has no problem at all paying 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.
AMAT has a Quick Ratio of 1.79. This is a normal value and indicates that AMAT is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of AMAT (1.79) is worse than 64.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.5 | ||
| Quick Ratio | 1.79 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 13.12% over the past year.
AMAT shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 23.21% yearly.
The Revenue has been growing slightly by 6.55% in the past year.
Measured over the past years, AMAT shows a quite strong growth in Revenue. The Revenue has been growing by 13.22% on average per year.
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
Based on estimates for the next years, AMAT will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.36% on average per year.
Based on estimates for the next years, AMAT will show a small growth in Revenue. The Revenue will grow by 7.25% on average per year.
EPS Next Y10.28%
EPS Next 2Y6.31%
EPS Next 3Y8.38%
EPS Next 5Y10.36%
Revenue Next Year4.41%
Revenue Next 2Y3.63%
Revenue Next 3Y5.25%
Revenue Next 5Y7.25%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
AMAT is valuated rather expensively with a Price/Earnings ratio of 18.13.
Based on the Price/Earnings ratio, AMAT is valued cheaply inside the industry as 86.61% of the companies are valued more expensively.
AMAT's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.20.
The Price/Forward Earnings ratio is 17.73, which indicates a rather expensive current valuation of AMAT.
Based on the Price/Forward Earnings ratio, AMAT is valued cheaper than 81.25% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.71. AMAT is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.13 | ||
| Fwd PE | 17.73 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, AMAT is valued a bit cheaper than 78.57% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of AMAT indicates a rather cheap valuation: AMAT is cheaper than 83.93% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.74 | ||
| EV/EBITDA | 14.92 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
AMAT has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.76
PEG (5Y)0.78
EPS Next 2Y6.31%
EPS Next 3Y8.38%
5. Dividend
5.1 Amount
AMAT has a Yearly Dividend Yield of 1.08%.
AMAT's Dividend Yield is rather good when compared to the industry average which is at 2.31. AMAT pays more dividend than 82.14% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.38, AMAT's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.08% |
5.2 History
On average, the dividend of AMAT grows each year by 12.01%, 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 its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
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 2Y6.31%
EPS Next 3Y8.38%
173.54
+2.61 (+1.53%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners83.26%
Inst Owner Change-1.76%
Ins Owners0.26%
Ins Owner Change0.44%
Market Cap138.25B
Analysts77.07
Price Target197.76 (13.96%)
Short Float %2.82%
Short Ratio3.15
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.08% |
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)-4.79%
PT rev (3m)-1.82%
EPS NQ rev (1m)-11.19%
EPS NQ rev (3m)-10.4%
EPS NY rev (1m)-1.25%
EPS NY rev (3m)0.59%
Revenue NQ rev (1m)-8.56%
Revenue NQ rev (3m)-8.24%
Revenue NY rev (1m)-1.76%
Revenue NY rev (3m)-1.73%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.13 | ||
| Fwd PE | 17.73 | ||
| P/S | 4.83 | ||
| P/FCF | 23.74 | ||
| P/OCF | 17.94 | ||
| P/B | 7.09 | ||
| P/tB | 8.91 | ||
| EV/EBITDA | 14.92 |
EPS(TTM)9.57
EY5.51%
EPS(NY)9.79
Fwd EY5.64%
FCF(TTM)7.31
FCFY4.21%
OCF(TTM)9.67
OCFY5.57%
SpS35.92
BVpS24.48
TBVpS19.48
PEG (NY)1.76
PEG (5Y)0.78
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 | 9.92 |
F-Score7
WACC11.27%
ROIC/WACC2.49
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 Y10.28%
EPS Next 2Y6.31%
EPS Next 3Y8.38%
EPS Next 5Y10.36%
Revenue 1Y (TTM)6.55%
Revenue growth 3Y5.62%
Revenue growth 5Y13.22%
Sales Q2Q%7.73%
Revenue Next Year4.41%
Revenue Next 2Y3.63%
Revenue Next 3Y5.25%
Revenue Next 5Y7.25%
EBIT growth 1Y10.66%
EBIT growth 3Y3%
EBIT growth 5Y18.52%
EBIT Next Year16.07%
EBIT Next 3Y9.91%
EBIT Next 5Y5.84%
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%