TD Cowen Raises Applied Materials Price Target to $525

TD Cowen analyst Krish Sankar raised the price target on Applied Materials (NASDAQ: AMAT) to $525.00 (from $450.00) while maintaining a Buy rating.

“Strong Demand, Unprecedented Visibility Supports the Story; Two-year visibility is unprecedented in semi-caps, and with 23% share in leading-edge Foundry, 25% share in DRAM, and 50% growth in packaging keeps us constructive on AMAT.

PT to $525 or 30x CY27 EPS of ~$17.50 (~15% higher above St. pre-call). AMAT guided Semi business to grow more than 30% this CY, which at 20% share implies a WFE of +$140B, in line with LRCX outlook.

AMAT also expects a linear second half for sequential growth, and we model up mid-single digits Q/Q in both OctQ and JanQ after a ~16% growth in JulQ., translating to ~$155B in run-rate WFE exiting CY26.

Longer term, AMAT highlighted that its biggest customers have been providing an 8-qtr. rolling forecast, which gives AMAT visibility into mid-2028.

Interestingly, AMAT doesn’t think that calling out 2028 as a growth year is “too early to call,” which is unprecedented for semicaps and proves the durability of this cycle.

Management also expects to see “more and more capacity plans from customers.” This is important as the bear case for semicaps is that WFE estimates already embed most of the already announced greenfield capacity, particularly DRAM (see preview).

Further greenfield announcements are a catalyst.”

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