Applied Materials Stock Nabs Record High on Fresh Coverage

Bernstein is joining a bullish brokerage bunch

Assistant Editor
Mar 31, 2021 at 10:01 AM
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The shares of chip name Applied Materials Inc (NASDAQ:AMAT) are up 2.1% to trade at $129.45, grabbing fresh highs right out of the gate after Bernstein initiated coverage with an "outperform" rating and $160 price target. The firm sees long-term growth for the semiconductor stock, with a "positive long-term structural stance."

Today's pop has AMAT toppling its previous March 26 record high of $128.98. This high was the culmination of the stock's wild rally since October 2020 with guidance from the 50-day moving average. Year-over-year, the equity is up 168%. 

Coming into today, analysts were mostly bullish on Applied Materials stock. Of the 17 in coverage, 13 carried a "buy" or better rating, with the remaining four a tepid "hold." Plus, AMAT's 12-month consensus price target of $136.54 is a 5.2% premium to current levels. 

The options pits are of similar sentiment, per AMAT's 10-day call/put volume ratio of 3.33 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio stands higher than 83% of readings from the past year, indicating a healthier-than-usual appetite for calls recently.

Plus, these premiums are reasonably priced at the moment. The stock's Schaeffer's Volatility Index (SVI) of 45% stands higher than 20% of all other readings in its annual range, implying options players are pricing in relatively low volatility expectations at the moment. 

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