Applied Materials, Inc. (NASDAQ: AMAT – $17.05), the world’s largest chip-equipment manufacturer, reported sales of $2.49 billion in its fiscal third quarter, an increase of 9.9% over a year ago, but below analysts’ forecasts of $2.54 billion. Adjusted earnings settled at $0.33 a share, in line with Street expectations and compared to $0.28 last year. Despite the revenue shortfall, the company said that it took in orders totaling $2.89 billion, up 17% from the same quarter a year ago and outpacing expectations of $2.5 billion. The Silicon Systems and Applied Global Services Groups were the strongest contributors in the quarter, but its Display segment was flat and the company’s Energy and Environmental Solutions Group showed a loss for the period. The company generated $334 million in cash from operations, paid dividends of $123 million and used $625 million to repurchase 32 million shares of common stock during the third quarter. For the fourth quarter, management expects net sales to be in the range of flat to down 7 percent from the previous quarter, and adjusted EPS to be in the range of $0.27 to $0.31. Using the low-end of the range, Applied Materials is on track to earn $1.16 for the full year vs. $1.06 in fiscal 2014 and a valuation of 14.5 times that figure is reasonable given the company’s growth potential. Price appreciation is above average three to five years out in my opinion, with a decent dividend yield of 2.3% adding to the appeal. Given the solid underlying fundamentals here, I remain positive on the depressed shares and believe they are worthy of consideration in a well-diversified aggressive account.