Morgan Stanley cuts Applied Materials to 'equal-weight' on valuation concerns

Lam Research

18/05/2026 13:48

** Morgan Stanley downgrades chipmaking tools supplier Applied Materials AMAT.O to "equal-weight" from "overweight"

** Brokerage notes AMAT has been trading at a "material valuation discount" versus peers Lam Research LRCX.O and KLA Corp KLAC.O "given execution and concerns around market share loss in China"

** We think AMAT will be a share gainer in 2026 but, given our growth forecast is in-line with broader wafer fab equipment in 2027, we think the valuation discount is unlikely to narrow in the near term - Morgan Stanley

** Average rating of 39 analysts is "buy;" their median PT is $520 - data compiled by LSEG

** Up to last close, stock has risen 69.90% so far this year

 (Reporting by Anhata Rooprai in Bengaluru)

 ((Anhata.Rooprai@thomsonreuters.com))