UPDATE: Bank of America Merrill Lynch Lowers PO on Applied Materials to $17

Bank of America Merrill Lynch is out with its report today on Applied Materials AMAT, lowering its PO from $18 to $17. In a note to clients, Bank of America Merrill Lynch writes, "Our new FY11 estimates are $11B/$1.50 compared to prior estimate of $11.3B/$1.55. This moves our CY11E rev/EPS to $11.3B/$1.55. Semicap peers are trading at 10-11x CY11E earnings. Since AMAT continues to execute well on their operational improvements, we apply the upper end of the range on our CY11E EPS of $1.55. This gives us our new price objective of $17" Bank of America Merrill Lynch maintains Neutral on AMAT. Shares of AMAT closed Wednesday at $14.50.