Citi Jumps Applied Materials (AMAT) Target Ahead of Earnings

Applied Materials, Inc. (NASDAQ:AMAT) is included among the 15 Best Wide Moat Dividend Stocks to Invest in.

On February 4, Citi analyst Atif Malik raised his price target on Applied Materials, Inc. (NASDAQ:AMAT) to $400 from $250 and reiterated a Buy rating ahead of the company’s January-quarter earnings report scheduled for February 12. Citi is looking for results to come in above consensus, pointing to upward spending revisions across major foundry and memory chipmakers.

The stock’s move over the past year supports that view. Shares are up more than 66%, a reflection of strong demand for chipmaking equipment tied to the rapid buildout of AI-focused semiconductors. AI workloads require more advanced chips, and those chips need increasingly complex manufacturing tools. Applied Materials operates with a relatively stable growth model. New fabrication plants and capacity expansions take years to plan and execute. Once equipment is installed, it doesn’t stop generating value. Ongoing service, upgrades, and maintenance create recurring revenue streams that add visibility to earnings.

That structure positions the company well as chip manufacturing continues to expand globally. Demand is being driven not just by AI, but also by electric vehicles, network-connected industrial equipment, and broader digitization across industries. These trends tend to move slowly, but they last.

Financially, Applied Materials continues to execute. The company posts strong operating margins and returns its free cash flow to shareholders through dividends and share repurchases, keeping capital allocation straightforward and shareholder-focused.

Applied Materials, Inc. (NASDAQ:AMAT) provides materials engineering solutions, supplying equipment, services, and software to the semiconductor, display, and related technology industries.

While we acknowledge the potential of AMAT as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: Dividend Growth Stocks: 25 Aristocrats and 12 Best HVAC Stocks to Buy Now

Disclosure: None.