UPDATE: JPMorgan Upgrades Applied Materials (AMAT) to Overweight
- Wall Street rallies, snaps longest weekly losing streak in decades
- 'Always Bet on Michael': Dell (DELL) Stock Soars After Crushing Estimates, Analysts Say Results are Impressive
- Credit Suisse Says Tesla (TSLA) Stock Offers an Attractive Entry Point, Sees Nearly 60% Upside From Here
- Citi Downgrades US Equities to Neutral on Recession Risk
- Elon Musk Says Recession Could Last 12 to 18 Months, But 'Actually a Good Thing'
JPMorgan upgraded Applied Materials (NASDAQ: AMAT) from Neutral to Overweight with a price target of $30.00 (from $19.00). Analyst Harlan Sur noted continued WFE spending momentum.
"We are upgrading Applied Materials to Overweight (from Neutral) with a $30 Dec-2015 price target driven by its solid position in the semiconductor equipment market (deposition/etch/epi/implant), our continued positive outlook on the current Moore’s Law–driven wafer equipment (WFE) spending cycle, and improving confidence in the successful completion of the merger with Tokyo Electron (TEL – covered by J.P. Morgan Electronics/Precision & Industrial analyst, Hisashi Moriyama) in 2H'14 and the unlocking of significant earning power potential in FY16 and FY17," said Sur.
"Much of the incremental increase in process steps on next-gen semiconductor manufacturing technologies is in AMAT/TEL’s core areas of etch and deposition. As such, we believe the combined entity will be positioned strongly to benefit from increased capital intensity associated with next-gen technologies including 3D NAND, 20nm DRAM, and 16/14nm FinFET architectures and have the scale to tackle the transition to 450mm and EUV (at least 3+ years out). Additionally, management teams at both companies remain on focus to drive meaningful cost synergies post-deal closure and drive solid profit margin expansion and EPS growth over the next 18-24 months. Given a healthy WFE spending environment over the next few years, combined with cost synergies, we estimate AMAT/TEL can generate $1.90 - $2.00/share of earning power by FY16, and this drives our new $30 price target (up from $19 for Dec-14)," he added.
Shares of Applied Materials closed at $22.81 yesterday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Jack In The Box (JACK) PT Lowered to $80 at Stifel
- Countryside Properties PLC (CSP:LN) PT Lowered to GBP2.60 at Deutsche Bank
- Softbank Corp. (9434:JP) (SFBQF) PT Lowered to JPY2,300 at Citi
Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS View, Analyst PT Change, Hot Upgrades, Upgrades
Related EntitiesJPMorgan, Definitive Agreement
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!