Applied Materials (AMAT) Stock Upgraded to Buy as BofA Targets $250 on DRAM Strength

Applied Materials, Inc. (NASDAQ:AMAT) is one of the AI Stocks in Focus on Wall StreetOn October 13, Bank of America upgraded the stock to “Buy” from Neutral with a $250 price target. The firm believes that the semiconductor stock’s valuation is attractive.

The rating upgrade reflects prospects of wafer fab equipment, or WFE, growth in 2026. This would be the first time in four years, driven by robust Dynamic Random Access Memory, or DRAM, investments and an attractive valuation gap to large peers.

The firm has raised its calendar 2025 and 2026 WFE growth estimates by 6% and 9%, respectively.

“We upgrade AMAT to a Buy (from a Neutral) and raise our PO to $250 on prospects of WFE [wafer fab equipment] outgrowth in CY26, the first time in four years, due to robust DRAM investments and an attractive valuation gap to large peers.”

Applied Materials, Inc. (NASDAQ:AMAT) is a leader in materials engineering solutions engaged in the provision of manufacturing equipment, services, and software to the semiconductor, display, and related industries.

While we acknowledge the risk and potential of AMAT as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AMAT  and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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