RBC Capital reaffirmed an Outperform rating on Applied Materials and kept a $385.00 price target on the shares, pointing to structural industry dynamics and the company’s positioning in several high-growth product areas. Applied Materials is trading at $326.74, substantially higher than its 52-week low of $123.74 and having produced an 81.79% total return over the last year. InvestingPro data cited in the research indicates the stock is overvalued relative to its assessed Fair Value.
The RBC note anticipates Applied Materials will deliver quarterly results modestly above consensus, which the firm says aligns with recent patterns among peer companies in the semiconductor equipment sector. RBC analyst Srini Pajjuri highlighted Applied Materials’ market strength in DRAM/HBM memory, semiconductor packaging and advanced logic technologies as key contributors to the firm’s positive view.
RBC’s analysis suggests those competitive advantages should outweigh moderate pockets of weakness the firm identifies - notably in the ICAPS grouping (IoT, Communications, Automotive, Power and Sensors) and within the Chinese market. The research further argues that consensus expectations for high-single-digit growth in calendar 2026 may be conservative given Applied Materials’ exposure to the portions of the market showing stronger demand.
On valuation, RBC noted Applied Materials trades at roughly a 15% discount to peers, a gap the firm views as attractive when juxtaposed with the company’s growth prospects and strategic positioning in semiconductor equipment.
Other broker activity in the sector has reflected a generally constructive stance. Mizuho upgraded Applied Materials from Neutral to Outperform and increased its price target from $275 to $370, citing higher capital spending in regions such as the United States, Taiwan and Japan. Deutsche Bank moved its recommendation from Hold to Buy and set a $390 price target, referencing a favorable outlook for the wafer fabrication equipment environment through 2026 and 2027. KeyBanc Capital Markets raised its price target to $380 while keeping an Overweight rating, citing Applied Materials’ role in meeting AI-related demand and its diversified supplier position.
The research commentary also mentions that RBC Capital initiated coverage on the company with an Outperform rating and the same $385 target, a point included in the firm’s communications alongside discussion of historical performance versus industry indices and challenges such as China-related headwinds. Separately, Lynx Equity raised its price target on Lam Research to $280, calling attention to what it sees as under-appreciated earnings potential into 2027 and expecting upcoming earnings to prompt upward revisions to consensus estimates.
Applied Materials reported $28.37 billion in revenue over the trailing twelve months, a figure highlighted in the InvestingPro profile that labels the company a prominent player in the Semiconductors & Semiconductor Equipment industry. Analysts expect the company’s near-term results to slightly exceed consensus, and recent brokerage moves suggest optimism about the sector’s outlook.
Taken together, the gamut of analyst actions - upgrades, target raises and reiterated Outperform ratings - suggest a broadly positive backdrop for semiconductor equipment stocks, even as some segments and geographic markets face headwinds. Investors tracking the group will likely weigh upcoming corporate reports and capital expenditure patterns regionally to reassess growth and valuation assumptions.