Applied Materials Stock Dips After Analyst Issues Sector-Wide Downgrade

Analysts were extremely optimistic coming into today

Managing Editor
Jul 8, 2019 at 9:46 AM
facebook twitter linkedin


Exactly one week after inking a deal with Japanese chipmaker Kokusai Electric, tech stock Applied Materials, Inc. (NASDAQ:AMAT) is suffering a pullback. The catalyst behind this morning's decline looks to be a bear note out D.A. Davidson, specifically a downgrade to "neutral" from "buy" and price-target cut to $45 from $55.

The brokerage firm issued a sector-wide downgrade for semiconductor stocks, saying the delay in memory recovery, falling prices, and geopolitical turmoil with China is weighing heavy. In response, AMAT was last seen down 1.9% at $43.14.

Overall analyst attention had been optimistic ahead of today's note. Specifically, 11 of the 17 covering firms sport a "buy" or "strong buy" recommendation, with just six "hold" and zero "sell" ratings accounted for. Further, the stock's average 12-month price target of $51.10 comes in 16.2% above Friday's close of $43.98.

Technically, Applied Materials stock has climbing the charts long term. During the month of May, however, the shares repeatedly pulled back near the $39 floor, which ran in line with the 200-day moving average. Year-over-year the stock remains just below breakeven, but year-to-date boasts a 34.3% lead.

 

If you are not making money with options, you aren’t buying options like this…

There is no options strategy that more perfectly approaches trading the fastest moving and most volatile stocks available in the marketplace than this one. In fact, there is no strategy that better utilizes put options for optimal returns and a real trading edge over other traders in the exact same market. New options traders fail out at an incredible rate without proper trade research, execution timing, and option picking. Capitalize on Schaeffer’s 100+ years of options trading excellence with the most coveted product launch in company history. Don't waste another second... join us right now before the next round of trades are released!

 


 


 
Special Offers from Schaeffer's Trading Partners