Can Solar Drive Applied Materials Earnings? (AMAT)

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Tuesday after the close, we’ll get to see earnings out of Applied Materials Inc. (NASDAQ: AMAT). The estimates for the semiconductor fabrication company from First Call are $0.22 EPS on $2.14 billion in revenues.  Next quarter estimates are $0.26 EPS on $2.28 billion in revenues. Estimates for fiscal Oct-2008 are $1.01 EPS on $8.95 billion in revenues.

Analysts have an average price target north of $24.00.  Applied Materials’ 52-week trading range is $16.13 to $23.00.  Shares are still in the middle of its 52-week trading range and it really just looks like the stock has support $1.00 under and resistance $1.00 higher based on its trading bands.

Shares closed up 3% Monday after the company described another win for its solar operations, and that is where we think the focus will be.  This one still has the multiple of a chip cap-ex and equipment player rather than a solar player.

Jon C. Ogg
May 12, 2008