BUZZ-Street View: AMAT's bullish case emerges unscathed from quarterly noise

Applied Materials AMAT.O on Thursday projected fourth-quarter revenue above Wall Street estimates, driven by expectations that sustained demand for advanced AI chips will keep semiconductor manufacturers investing heavily in its chip-making equipment.

Shares were down 4.8% at $508.88 premarket.

J.P. Morgan ("overweight," PT: $660) says the bullish investment case remains intact, supported by rising AI-driven WFE demand, better earnings visibility, a stronger product mix, growth in its high-margin services business (AGS), and continued gross margin expansion.

Jefferies ("buy," PT: $770) believes results highlight both the scale and sustainability of AMAT AI-driven growth, positioning the company for another strong year in calendar 2027.

TD Cowen ("buy," PT: $700) says "bigger picture, we remain early-mid cycle in WFE & industry tailwinds are too strong for this print to change the narrative".

RBC Capital Markets ("outperform," PT: $600) says it is not overly concerned and expects margins to expand gradually, supported by higher volumes and pricing in a strong wafer fabrication equipment (WFE) environment, which it believes will remain favorable over the next three years.