Street View: Applied Materials poised to gain from AI-led spending

Morningstar

13/02/2026 14:54

** Chip equipment maker Applied Materials' AMAT.O shares jump ~11% to $364.17

** Co on Wednesday forecast Q2 revenue and profit above estimates on boom in AI processor demand and worldwide memory shortage

** Average rating of 37 analysts is "buy"; median PT is $420 - data compiled by LSEG

** Up to last close, stock up 79.3% in last 12 months

AI CAPEX TAILWINDS

** Morningstar (fair value: $380) says it expects "massive" wafer fabrication growth cycle over next three years, noting that AI infrastructure demand is immense and supply scarce

** B Riley ("buy," PT: $450) says it is impressed with AMAT's macro commentary, which brokerage "thought alluded to fast approaching $150B in annual WFE (wafer fabrication equipment)"

** Jefferies ("buy," PT: $415) notes AI-driven equipment spend on high performance chips and high-bandwidths of memory should drive 20%+ growth in CY26, with continued growth expected into 2027

** RBC Capital Markets ("outperform," PT: $430) notes AMAT is benefiting from GenAI spending, says "China share loss concerns are overdone"; expects double-digit topline momentum to sustain into 2027

 (Reporting by Anhata Rooprai in Bengaluru)

 ((Anhata.Rooprai@thomsonreuters.com))