Citi Comments On Applied Material Following Analyst Day

According to a recent note from Piper Jaffray, Applied Materials AMAT hosted a thinly attended but well-executed analyst day Wed. It saw three key conclusions: AMAT is back to being a growth story after several years of punk performance in key segments like semis and service; there is a lot of fruit left to harvest in terms of operations; and it should continue to maintain elevated levels of cash to maintain M&A optionality. Citing no material impact from Japan earthquake, AMAT kept its FQ2 and full year guidance intact. AMAT maintained its view on multi-year growth cycle in semis, and suggested 2012 capex would be largely flat at an elevated level, not particularly controversial. A more encouraging note is AMAT's push on new product/market growth through its renewed technology innovation. Piper sees several key efforts that could drive meaningful rev growth: 12 new products in semis to target future transistor node and advanced packaging; new efforts in battery storage, OLED, and an MOCVD tool. Citi has a Hold and $17 PT on AMAT AMAT closed Wednesday at $15.16