Loop Capital starts Applied Materials at Buy, sees sales outperform WFE capex

Loop Capital analyst Scott Graham initiated coverage of Applied Materials with a Buy rating and $125 price target. The company’s Semiconductor sales should outperform the overall WFE capex, both during the current downturn and when capex turns positive again in Q3 of FY24, the analyst tells investors in a research note. PPACt initiatives focus on newer methods to advance chip nodes even as Moore’s Law slows, and Applied Materials’ core competences line up well with these needed solutions, Graham adds, stating that the expects the stock to be revalued vs. its peers on WFE capex out-performance and a limited duration of quarterly earnings declines.