Is AMAT a good stock to buy? We came across a bullish thesis on Applied Materials, Inc. on BEP Research’s Substack by Ben Pouladian. In this article, we will summarize the bulls’ thesis on AMAT. Applied Materials, Inc.’s share was trading at $361.79 as of March 23rd. AMAT’s trailing and forward P/E were 36.62 and 32.79 respectively according to Yahoo Finance.
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Applied Materials, Inc. provides materials engineering solutions, equipment, services, and software to the semiconductor and related industries in the United States and internationally. AMAT delivered fiscal Q1 2026 results that underscore the accelerating AI-driven semiconductor equipment cycle, confirming the thesis that packaging and advanced logic demand are entering a multi-year expansion. The company reported $7.01 billion in revenue, exceeding consensus by 2%, and non-GAAP EPS of $2.38, beating estimates by 7.7%.
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The standout signal came from Semiconductor Systems, where DRAM equipment revenue hit a record $1.75 billion, driven by high-bandwidth memory (HBM) stacking and advanced deposition, bonding, and thinning tools. DRAM now represents 34% of the segment’s revenue, highlighting the equipment intensity of moving from 12-Hi to 16-Hi and eventually 20-Hi HBM stacks, which requires exponentially more tool usage per wafer. Applied is doubling manufacturing capacity and increasing inventory to meet this growing demand, reflecting strong customer commitment and leading-edge fab utilization.
Equally important, Applied launched three new systems for 2nm Gate-All-Around transistors and advanced wiring, including Viva, Sym3 Z Magnum, and Spectral, enabling critical process improvements and new tool sales for leading-edge fabs. These innovations materially expand equipment content per wafer start and reinforce Applied’s leadership in deposition, etch, and packaging.
The Q2 guide reinforces the momentum, projecting $7.65 billion in revenue, roughly 9% above Street expectations, with non-GAAP EPS of $2.64. Management highlighted multi-year visibility from fab expansions, cloud provider CapEx, and AI datacenter growth surpassing PCs and smartphones in wafer starts. Global Services revenue also hit $1.56 billion, providing a recurring, high-margin revenue stream. China exposure declined slightly, while Taiwan and Korea growth offset any regional headwinds. Overall, Applied’s results confirm that AI-driven memory and advanced logic are driving a structurally higher and accelerating equipment cycle, positioning the company for sustained multi-year growth.
Previously, we covered a bullish thesis on Applied Materials, Inc. (AMAT) by Long-Term Pick in March 2025, highlighting its leadership in semiconductor equipment, AI-driven wafer fabrication, and advanced packaging. AMAT’s stock price has appreciated by approximately 128.87% since our coverage. Ben Pouladian shares an identical view but emphasizes record DRAM revenue, multi-layer HBM stacking, and new 2nm GAA tooling confirming a multi-year AI-driven equipment cycle.
Applied Materials, Inc. is on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 111 hedge fund portfolios held AMAT at the end of the fourth quarter which was 89 in the previous quarter. 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.
Disclosure: None.
