Applied Materials Quarterly Results Exceed Estimates
Applied Materials Corp. (NASDAQ: AMAT – $17.56) the world’s largest manufacturer of wafer fabrication equipment for the semiconductor industry and manufacturing solutions for the display and solar industries, posted fiscal fourth quarter net sales of $1.99 billion (vs. analysts’ estimates of $1.974 billion), up 1% from the third quarter. Adjusted net income grew 3% from the third period to $228 million or $0.19 per diluted share, which was a penny better than Street expectations and well above the $0.06 in the comparable year-ago period. Backlog grew 4% to $2.37 billion, up from $1.65 billion in the year-ago fourth quarter, as foundry customers build new production lines to make more advanced components. In the latest quarter, Applied generated orders of $2.09 billion, up 5% from the prior quarter led by strengthening demand in the Silicon Systems Group. Looking ahead to the first quarter of fiscal 2014, AMAT expects net sales to be up 3% to 10% from the previous quarter and adjusted earnings is expected to be in the range of $0.20 – $0.24 per share. For all of fiscal 2014, earnings can come in between $1.00 – $1.05 per share, but the company remains cautious for the first half of the year. This equity has above-average appreciation potential over the 3- to 5-year pull, as well as a solid, well-covered dividend yielding 2.3% and can continue to be held in aggressive accounts.