Halister News

(Bloomberg) -- Applied Materials up 8% pre-mkt after beating on 2Q sales and earnings, and raising 3Q guidance above Street estimates; AMAT is “one of the best-positioned companies in the semiconductor equipment space,” says Pacific Crest analyst Weston Twigg. KEY DETAILS:

• 2Q adj. EPS 34c vs est. 32c
• 2Q net sales $2.45b vs est. $2.43b
• Sees 3Q adj. EPS 46c-50c vs est. 36c
• Sees 3Q sales growth 14%-18% q/q

AMAT Commentary from call/release:

• CEO: “In our second quarter we booked our highest orders in 15 years and we expect to deliver record earnings in fiscal 2016”
• CEO: “Pipeline of differentiated products that will fuel future growth”

ANALYST COMMENTARY Pacific Crest (Weston Twigg)

• AMAT “one of the best-positioned companies in the semiconductor equipment space”
• Benefits from strong 3D NAND and OLED demand in the near- term
• Has exposure to foundry/logic demand as segment improves
• Posted a “staggering” $700m in 2Q display orders, almost as much as the entire FY2015 revenue of $780m
• Reiterate buy, raise PT to $26 from $23

Goldman Sachs (Toshiya Hari)

• Expects estimates to move higher as Street begins to “appreciate the sustainability of 3D NAND and OLED capex”
• Top pick in semi cap
• Multiple technology inflections combined with broadening of customer base (ie: China) creates attractive opportunity
• Reiterate buy, raise PT to $25 from $24

Stifel (Patrick Ho)

• Growth trajectory is “stronger than expected”
• The magnitude of the strength in semi cap and display buinesses “highlights the company’s strong position in these markets and its readiness to capitalize upon key industry inflections”
• After release, “long term prospects are even brighter now”
• Opportunity in display “has sustainable legs over the next few years given the industry’s emerging shift to OLED-based consumer devices”
• Buy rating, PT $24

UBS (Stephen Chin)

• Confident the stock “has multiple ways to work”
• “Impressed” with execution in winning large OLED equipment order
• Sees an additional 50c in EPS upside if new OLED TV cycle starts
• Semicap orders in 2H should increase vs 1H on foundry strength
• Reiterate buy rating, raise PT to $28.50 from $26

DATA:

• 19 buys, 5 holds, 1 sell, avg PT $25: Bloomberg data
• AMAT shares up 6.6% YTD; up 27.3% from year low on Feb. 11
• Short interest 0.3% of float: Markit