RBC Capital Raises Applied Materials Price Target to $520

RBC Capital analyst Srini Pajjuri raised the price target on Applied Materials (NASDAQ: AMAT) to $520.00 (from $500.00) while maintaining an Outperform rating.

“AMAT reported a solid quarter and now sees 30%+ growth in its Systems business for CY26 (vs 20%+ prior). Visibility is extending to 8-quarters and 2027 is shaping up to be another strong year.

DRAM, Advanced Logic, and Advanced Packaging are the main drivers while ICAPS/China have stabilized.

AGS (Services) is also faring better and management raised its long term growth expectation for this segment.

Looking ahead, we expect double-digit WFE growth to sustain for the next 2-3 years driven by GenAI, extreme tightness in Memory, and re- emerging competition in Advanced Foundry.

AMAT appears particularly well positioned given its leadership in DRAM/Advanced Logic and exposure to new technologies such as GAA/BSP/4F^2. We raise estimates, raise PT, and reiterate Outperform.”

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