Applied Materials Inc. (AMAT): Today's Featured Electronics Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Applied Materials ( AMAT) pushed the Electronics industry lower today making it today's featured Electronics laggard. The industry as a whole closed the day down 0.2%. By the end of trading, Applied Materials fell 18 cents (-1.5%) to $11.68 on average volume. Throughout the day, 13.3 million shares of Applied Materials exchanged hands as compared to its average daily volume of 12.5 million shares. The stock ranged in price between $11.67-$11.87 after having opened the day at $11.86 as compared to the previous trading day's close of $11.86. Other companies within the Electronics industry that declined today were: Winland Electronics ( WEX), down 16.7%, Dynasil Corporation of America ( DYSL), down 13.1%, Tel Instrument Electronics Corporation ( TIK), down 12.2%, and LightPath Technologies ( LPTH), down 8.9%.

Applied Materials, Inc. provides manufacturing equipment, services, and software to the semiconductor, flat panel display, solar photovoltaic (PV), and related industries worldwide. Applied Materials has a market cap of $14.73 billion and is part of the technology sector. The company has a P/E ratio of 14.3, equal to the average electronics industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Shares are up 11.2% year to date as of the close of trading on Friday. Currently there are six analysts that rate Applied Materials a buy, two analysts rate it a sell, and nine rate it a hold.

TheStreet Ratings rates Applied Materials as a hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and feeble growth in the company's earnings per share.

On the positive front, A123 Systems ( AONE), up 19.5%, SatCon Technology Corporation ( SATC), up 12.7%, RF Industries ( RFIL), up 12.3%, and Vimicro International Corporation ( VIMC), up 11.6%, were all gainers within the electronics industry with Taiwan Semiconductor Manufacturing ( TSM) being today's featured electronics industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the electronics industry could consider iShares Dow Jones US Technology ( IYW) while those bearish on the electronics industry could consider ProShares Ultra Short Semiconductor ( SSG).

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