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Fundamental analysis: Applied Materials, Inc. (AMAT)

Awarener score: 7.5

Conclusion

The higher the Awarener score, the more bang you get for the buck. It measures how much genuine funds the company generates for the stock price paid (Very good), the business stability (Modest) and growth (Average), and the company's inclination to return cash to the stockholders (Excellent).

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 5.5

  • Business has been growing at a low pace. It's been below average when measured against peer companies.
  • Applied Materials, Inc. business trend isn't so stable. The higher the stability, the lower the risk. It looks well ranked against rivals.

Margins score: 8.7

  • AMAT profit margins -on goods and services sold- are usually good. They stand slightly worse than rival companies.
  • Business profit on sales tends to be huge. It's great when measured against competitors.
  • Profits on sales made -available to repay debt and purchase properties- are usually very good. They remain in good shape compared to peers.
  • Earnings -before income taxes and interests on loans taken- tend to be excellent in relation to total revenues. They're still well ranked against similar companies.
  • Profits -before income taxes- are usually excellent considering total sales, and remain more than average in relation to rivals.
  • Total net profit tends to be excellent when confronted to sales. Company stands great when measured against comparable firms.

Growth score: 5.6

  • Applied Materials, Inc. profit -on goods and services sold- has been growing at a normal pace. It's been lacking compared to competitors.
  • In recent years, earnings -on operations- have been growing at a low step, which has been mediocre against comparable firms.
  • Profits -available to repay debt and purchase properties- have been growing at a normal pace, which compares almost average when measured against peer enterprises.
  • Earnings -before income taxes and interests on loans taken- have been growing at a normal tempo. It turns to be lacking compared to similar stocks.
  • In past years, profits -before income taxes- grew at a low speed. It was mediocre against rivals.
  • In the previous years, growth on total net profit has been low, and below average when measured against peer companies.
  • Earnings per share have grown at a normal rhythm in past years. It's been lacking compared to industry peers.

Miscellaneous score: 7.0

  • AMAT managed to pay little to no income taxes on profits made in the past years. It's been somewhat better than peers.
  • Research and development expenses consume a low portion of revenues. It's almost average when measured against competitors.
  • The company grows modestly in relation to research and development efforts. It stands in a weak position compared to rival companies.

Profitability score: 10.0

  • Applied Materials, Inc. usually gets huge returns on the resources it controls. It proves top tier when measured against peer firms.
  • The company normally gets huge proceeds -on the resources directly invested in the business-. They remain impressive in relation to similar companies.
  • Profitability -in relation to owned resources- is usually paramount. It ranks top tier when measured against competitors.
  • In the past, got huge returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's great when measured against comparable enterprises.

Usage of Funds score: 7.1

  • AMAT usually uses a sparse portion of genuine funds generated to buy or replace property, plant, or equipment. The need for reinvestments is modest. It stands great when measured against rival firms.
  • The company is usually investing in new property, plant, and equipment, to improve its operating capabilities, which is great when measured against industry peers.
  • In the past twelve months it paid somewhat low dividends, considering the current stock price. It came slightly worse than competitors.
  • Has increased dividend payments in the past years. Business prospects may have improved. The company has behaved close to average when compared to similar firms.
  • Dividend payments usually represent a modest portion of genuine funds generation and should be reasonable safe. Sustainability looks slightly worse than comparable companies.
  • The company usually significantly reduces the pool of investors, resulting in fewer mouths feeding on the pie of profits. It remains impressive in relation to peer enterprises.
  • Repurchase effectiveness metric is very complex. Run again in analytical mode if you 're interested in a technical explanation. It stands excellent in relation to rivals.
  • The company uses a large portion of genuine fund generation to reward investors, which can probably be sustained for as long as business doesn't turn sour. It still looks weak when measured against competitors.

Balance Sheet score: 5.3

  • Applied Materials, Inc. intangible assets (like brands and goodwill) represent some portion of resources controlled, according to accounting books. There could be some difficulties in liquidating them if the company ever gets in financial distress. It happens to be below average when measured against peer companies.
  • The company has roughly double short-term resources than short-term obligations. Liquidity concerns are normally not an issue. It turns to be a disappointment compared to similar firms.
  • Roughly a quarter of resources controlled were provided for with financial debt. Creditors have some claims on the company. It remains slightly worse than rival firms.
  • Controlled resources can be made into cash within reason, which is quite good for liquidity. It looks almost average when measured against rivals.
  • For every dollar of short-term obligations, the company has enough dollars in cash and short-term receivables. It's a disappointment compared to peer firms.
  • For every dollar of short-term obligations, the company has roughly half of cash and equivalents, which is bottom tier against similar enterprises.
  • Usually, sales are on somewhat less than three months credit. It still ranks similar to peers.
  • Normally has approximately five months of sales worth in inventory. It comes up as close to average when compared to competitors.
  • On average, it takes a lot of months from the purchase to charging customers. It happens to be slightly better than peers.
  • On average pays suppliers approximately four months or higher after the purchase. It ranks last-in-rank when measured against industry peers.
  • The company pays its suppliers four months or more before charging its customers, so there's significant money invested in working capital. It's in a weak position compared to similar companies.
  • Net interest expenses consume a slight portion of usual business earnings, and are very easily bearable. It stands well ranked against rival firms.
  • Business earnings have usually been very good when measured against loans taken. Cutting back reinvesting in the business, it could take less than two years to repay the obligations with current profitability. It ranks encouraging in relation to comparable enterprises.
  • Revenues are very good in relation to property, plant, and equipment required to operate. This metric is likely dependent on the industry the company operates in. Low property, plant, and equipment requirements allows the company to keep more money to reward stockholders in the long run. It looks excellent in relation to similar firms.
  • Resource exploitation is very good when yearly sales are considered. This metric is normally tied to the industry where the firm belongs. It's still well ranked against peer companies.

Valuation score: 6.7

  • Applied Materials, Inc. looks cheap in relation to profits and financial position. It happens to be more than average in relation to competitors.
  • Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains in a weak position compared to peers.
  • In the past twelve months, the company generated some good free funds in relation to the stock price, which stands slightly worse than similar companies.
  • The company usually generates more than enough genuine funds to cover up for its business needs. Surplus cash may be used to repay loans, to eventually buy new businesses, or to reward investors. Considering the financial position and stock price, at the current price the share might be interesting. It's still similar to industry firms.
  • In the past twelve months, the company has rewarded investors, considering both dividends and share on the pie of earnings. It came up excellent in relation to peer ventures.
  • The company has neither net debt nor net cash. It may borrow extra money if it wishes so, or start cumulating cash for future uses. It looks mediocre against similar enterprises.
  • Considering the past twelve months, traditional Price-to-Earnings relation might be reasonable. It ranks more than average in relation to peer companies.
  • Comparing the current stock price with the past twelve-months revenues gives a three or four to one relationship. This is an important metric to check its evolution through time, and to compare to industry peers. It looks close to average when compared to rival firms.
  • The relation between the stock price and accounting book value is really high, which may be good or bad depending on context. Run again in analytic mode if you want to dig deeper. The company remains mediocre against peer firms.
  • In the past twelve months, the operating business earned great money when compared to the current stock price and financial position. It happens to be more than average in relation to industry peers.
  • In an alternate metric of bang for the buck, the company has usually shown a very good earnings power ability when measured against the current stock price and financial position. It's still excellent in relation to peer companies.

Total score: 7.0


AMAT logos

Company at a glance: Applied Materials, Inc. (AMAT)

Sector, industry: Technology, Semiconductor Equipment & Materials

Market Cap: 72.52 billions

Revenues TTM: 25.16 billions

Applied Materials, Inc. provides manufacturing equipment, services, and software to the semiconductor, display, and related industries. It operates through three segments: Semiconductor Systems, Applied Global Services, and Display and Adjacent Markets. The Semiconductor Systems segment develops, manufactures, and sells various manufacturing equipment that is used to fabricate semiconductor chips or integrated circuits. This segment also offers various technologies, including epitaxy, ion implantation, oxidation/nitridation, rapid thermal processing, physical vapor deposition, chemical vapor deposition, chemical mechanical planarization, electrochemical deposition, atomic layer deposition, etching, and selective deposition and removal, as well as metrology and inspection tools. The Applied Global Services segment provides integrated solutions to optimize equipment and fab performance and productivity comprising spares, upgrades, services, remanufactured earlier generation equipment, and factory automation software for semiconductor, display, and other products. The Display and Adjacent Markets segment offers products for manufacturing liquid crystal displays; organic light-emitting diodes; and other display technologies for TVs, monitors, laptops, personal computers, electronic tablets, smart phones, and other consumer-oriented devices. The company operates in the United States, China, Korea, Taiwan, Japan, Southeast Asia, and Europe. Applied Materials, Inc. was incorporated in 1967 and is headquartered in Santa Clara, California.

Awarener score: 7.5

Conclusion

The higher the Awarener score, the more bang you get for the buck. It measures how much genuine funds the company generates for the stock price paid (Very good), the business stability (Modest) and growth (Average), and the company's inclination to return cash to the stockholders (Excellent).