Applied Materials, Inc. (NASDAQ: AMAT – $52.08) announced a new share repurchase program authorizing up to an additional $3 billion in repurchases. As of the end of the company’s fiscal third quarter, about $995 million remained available under the prior authorization, as the company continues returning cash to shareholders. Applied also provided a new three-year financial outlook at its 2017 Analyst Day, saying it is targeting adjusted earnings per share of $5.08 for fiscal 2020 based on a $45 billion wafer fab equipment (WFE) market with increases in market share, gross margin, R&D investment and operating profit. The company also expects WFE spending in 2017 and 2018 combined to be $90 billion and display equipment spending to be $36 billion. The company’s services revenue is projected to reach $4.5 billion by 2020. The company said this will be driven by new technology inflections like artificial intelligence and “big data” that will increase demand for high-performance semiconductor processing and storage.
The company reported strong third quarter results in August and full-year earnings are expected at $3.20 ending October 2017 and $3.61 in fiscal 2018. The shares, at a new record high, can continue to be held for further capital gains.