New York, February 3, 2026, 12:26 ET — During the regular session
- Shares of Applied Materials dropped roughly 2% by midday, following a wider sell-off in semiconductor and tech stocks.
- On Monday, Morgan Stanley and UBS raised their price targets for the stock.
- All eyes are on Applied as it prepares to release its February 12 earnings and provide guidance for the April quarter.
Applied Materials shares fell roughly 2% to $321.73 in midday trading Tuesday, erasing some of Monday’s gains and leaving the chip-equipment maker stuck in a weak tech sector.
Timing is crucial. Chip-tool stocks are valued based on the assumption that manufacturers will continue investing in new capacity and upgrades linked to data centers, memory, and advanced packaging. Investors show little tolerance for any hiccup in order trends.
Applied plans to release its fiscal first-quarter results on Feb. 12, followed by an earnings call at 4:30 p.m. ET. This event could shift forecasts for demand, margins, and buybacks as spring approaches. Nasdaq
U.S. stocks slid Tuesday, dragged down by a selloff in software and cloud sectors. Investors are wrestling with whether AI-linked stocks have already hit “priced for perfection,” according to John Campbell at Allspring Global Investments. Reuters
Semiconductors and toolmakers faced notable pressure. ASML dropped roughly 3.6%, KLA slid around 4.4%, and Lam Research fell close to 2.6%. Nvidia lost about 3.4%, while Advanced Micro Devices dipped by approximately 1.6%.
Analysts have been taking a more bullish stance. UBS’s Timothy Arcuri bumped up his price target to $405 from $285, keeping a Buy rating intact. Morgan Stanley also raised its target to $364 from $273 and held onto its Overweight call. The firm highlighted that a “beat and raise” — surpassing estimates and raising guidance — might shift investor sentiment. They’re eyeing an April-quarter revenue forecast of 3% to 4% growth, above Wall Street’s roughly 2% consensus. TipRanks
Traders will zero in on guidance and commentary on customer spending plans on Feb. 12 — specifically wafer fab equipment, or WFE, which refers to chipmakers’ capital outlays on production tools. The key question: is demand spreading beyond just a few high-end programs?
The risk remains: changing export regulations and inconsistent demand from China could disrupt forecasts for the group. Back in November, Applied flagged that tougher U.S. restrictions were limiting its access to China. CEO Gary Dickerson pointed out that “Non-U.S. equipment companies don’t have the same restrictions,” allowing competitors to sell in markets where Applied faces barriers. Reuters
All eyes turn to Feb. 12, when Applied will unveil its April quarter outlook. Investors want to see if there’s any change in China exposure or if management’s tone on second-half spending turns more assured.
