What's Going On With Applied Materials Stock?

Shares of Applied Materials, Inc. AMAT are trading lower by 6.5% to $184.36 during Tuesday’s session, driven by a broad sell-off in semiconductor stocks. Nvidia Corp.’s post-earnings slide, coupled with escalating geopolitical tensions and a risk-off sentiment in the broader market, has cast a shadow over the entire chip sector.

Geopolitical Tensions and Market Sentiment Drive Sector-Wide Declines: The broader market is also feeling the pressure from a risk-off mood ahead of the critical U.S. jobs report, which is due on Friday. This report could significantly influence the Federal Reserve's upcoming interest rate decision on September 18.

Geopolitical concerns are adding to the sector’s woes following a Nikkei report indicating that China's chip technology is advancing rapidly.

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The report suggested that Chinese-made chips are now only three years behind TSMC’s, raising concerns about the effectiveness of U.S. efforts to curb China’s technological progress.

Adding to the tension, there are reports that China has warned of possible retaliation if Japan restricts exports of chipmaking equipment to China. This development is particularly concerning for companies like Applied Materials, which relies on international markets for a significant portion of its revenue.

Impact on Applied Materials: Applied Materials, a major player in the semiconductor equipment industry, is particularly vulnerable to these geopolitical developments. Any escalation in trade tensions or export restrictions could disrupt its supply chain and limit its access to key markets, especially in China, one of its largest customers.

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Is AMAT A Good Stock To Buy?

An investor can make a few decisions when deciding whether a stock is a good buy. In addition to valuation metrics and price action which you can find on Benzinga's quote pages – like Applied Mat‘s page for example – there are factors like whether or not a company pays a dividend or buys a large portion of its stock each quarter.

These are known as capital allocation programs. Applied Materials does pay a dividend, which yields 0.79% per year as of the closing price on Sep. 3, 2024. Feel free to search Benzinga's dividend calendar for the next company that is due to pay a dividend and determine what kind of yield you can earn for holding a share of the company.

For example, if you're looking to earn an annualized return of 13.78%, you'll need to buy a share of Saba Cap Inc & Opps by the Sep. 10, 2024. Once done, you can expect to receive a nominal payout of $0.09 on Sep. 30, 2024.

Buyback programs are obviously different and highly variable. A company can approve a buyback program and purchase shares as it sees fit over the course of time in which the buyback was authorized. Looking through the latest news on Applied Mat will often yield whether or not the company has approved a buyback program recently. Buyback programs usually serve as a support for share prices, serving as a backstop for demand.

According to data from Benzinga Pro, AMAT has a 52-week high of $255.89 and a 52-week low of $129.21.