NEW YORK (TheStreet) -- Applied Materials (AMAT) received a vote of confidence from analysts at Cowen Group (COWN) ahead of the upcoming release of the company's second quarter earnings results.
Analysts at the firm believe that the company will report earnings in line with consensus estimates when it reports its results tomorrow.
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Cowen reiterated its "outperform" rating with a $20 price target on the company's shares.
Applied Materials shares are down slightly in early trading on Wednesday.
TheStreet Ratings team rates APPLIED MATERIALS INC as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:
"We rate APPLIED MATERIALS INC (AMAT) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth, largely solid financial position with reasonable debt levels by most measures, growth in earnings per share and compelling growth in net income. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Powered by its strong earnings growth of 600.00% and other important driving factors, this stock has surged by 30.10% over the past year, outperforming the rise in the S&P 500 Index during the same period.
- The revenue growth greatly exceeded the industry average of 4.1%. Since the same quarter one year prior, revenues rose by 39.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
- AMAT's debt-to-equity ratio is very low at 0.27 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, AMAT has a quick ratio of 1.53, which demonstrates the ability of the company to cover short-term liquidity needs.
- APPLIED MATERIALS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, APPLIED MATERIALS INC increased its bottom line by earning $0.21 versus $0.06 in the prior year. This year, the market expects an improvement in earnings ($1.08 versus $0.21).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 644.1% when compared to the same quarter one year prior, rising from $34.00 million to $253.00 million.
- You can view the full analysis from the report here: AMAT Ratings Report