AMAT
Applied Materials Inc.
TMT
03/15/2022
Presented
| Date | 03/11/2022 |
| Price | $123.64 |
| Market Cap | $109.22B |
| Ent Value | $118.83B |
| P/E Ratio | 17.2x |
| Book Value | $13.46 |
| Div Yield | 0.78% |
| Shares O/S | 883.40M |
| Ave Daily Vol | 8,252,297 |
| Short Int | N/A |
Current
| Price | $191.02 |
| Market Cap | $157.48B |
| Applied Materials, Inc. provides manufacturing equipment, services and software to the semiconductor, display and related industries. It operates through the following segments: Semiconductor Systems, Applied Global Services, and Display & Adjacent Markets. The Semiconductor Systems segment includes semiconductor capital equipment for etch, rapid thermal processing, deposition, chemical mechanical planarization, metrology and inspection, wafer packaging, and ion implantation. The Applied Global Services segment provides solutions to optimize equipment, performance, and productivity. The Display & Adjacent Markets segment offers products for manufacturing liquid crystal displays, organic light-emitting diodes, equipment upgrades, and other display technologies for TVs, monitors, laptops, personal computers, smart phones, and other consumer-oriented devices. The company was founded on November 10, 1967 and is headquartered in Santa Clara, CA. |
Publicly Traded Companies Mentioned Herein: Applied Materials Inc (AMAT), Intel Corp (INTL), Taiwan Semiconductor Manufacturing Co Ltd (TSM)
Highlights
The presenter is long shares of Applied Materials Inc (AMAT), a $122B market cap company that supplies equipment, services and software for the manufacturing of semiconductor chips. This historically GDP sensitive business is reducing its cyclicality because of increasing trade volume and high demand outstripping increases in overall capacity, thus eliminating the possibility of chip suppliers to build up stock. In the wake of the global microchip shortage, the presenter sees two structural drivers for growth in this segment. The first is that Moore’s Law has not held true recently and this is driving the capital intensity for machines as companies require more machines to produce smaller and smaller chips. The second driver for the business is the push towards onshoring that has been exacerbated by Russia’s invasion of Ukraine, which will create incremental demand for AMAT’s machines. If the company continues to trade at ~20x EPS, the $123 stock has an upside case to $200 in the next of couple years as 2023 EPS projections float just under $10.
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