Applied Materials, Inc. (AMAT): Analyzing Insider sell/Buy ratio

With 0.45 sell/buy ratio, Applied Materials, Inc. (NASDAQ:AMAT) experienced more insider buying than insider selling over the last three months. Could this be a sign for outside investors to start buying as well? AMAT recorded 10 sales on the open market in the last three months. They sold nearly 453,996 shares while purchases amounted to 1,015,565 shares that period. Looking even further back to 12 months, corporate insiders offloaded 503,593 shares when buyers snapped up 1,050,138 shares. The 12-month’s totals signify about a 0.48-to-1 sell/buy ratio.

Iannotti Thomas J parted with a total of 15 thousand shares of Applied Materials, Inc. (AMAT) at average share price of $61.47. This insider trade in the company took place on 03/12/2018. The total for the sales was set at $922.05 thousand. After this transaction, the Director account balance stood at 61.97 thousand shares. The stock lost -43.42 percent since that insider sale. On 01/03/2018, Forrest Stephen R, Director, sold 4 thousand shares at a price per share of $53.67. This removed 214.68 thousand shares from the insider’s fortune and the stock saw a -35.2 percent retreat in value since the news became public. This transaction left 71.18 thousand shares in the Director account.

On 01/02/2018, Senior VP, CTO Nalamasu Omkaram performed a sale transaction worth $2.83 million. This sale at $53 each has eliminated 53.47 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded -34.38 percent decrease since the transaction was reported. The insider now is left with 344.72 thousand shares remaining in the account. Salehpour Ali, who performs the Sr. VP, GM Srv., Dspl. & Flex. job, sold 125.13 thousand shares for $6.44 million. The disposal occurred on 12/29/2017 was priced at $51.47 per share. The share price plunged -32.43 percent since the reporting date. Salehpour Ali now left with a stake of 485.38 thousand AMAT stock worth $16.88 million after the insider selling.

The 12-month median price target for Applied Materials, Inc. (AMAT) assigned by the analysts stands at $46, which represents a return potential of 32.26 percent when compared to the closing price of the stock of $34.78 on Friday, January 11. The lowest price target for the stock is $33 — slightly more than -5.12 percent from AMAT’s current share price. The stock will probably climb 38.27 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $63-month high price target. This represents a whopping 81.14 percent increase from where shares are trading today.

On momentum oscillators front, ‘RSI’ has touched 56.13 on daily chart, which may remain a cause for concern. If the price breaks below $33.64 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $35.33 mark may result into a pull-back move towards $35.89 level. The stock is currently hovering around the first support level of $34.21. Below this, the next support is placed in the zone of $33.64. Till the time, the AMAT stock trades above this level, bulls have nothing to fear.

Shares of Applied Materials, Inc. (AMAT) are trading at a P/E ratio of 8.35 times earnings reported for the past 12 months. The industry AMAT operates in has an average P/E of 12.18. Its P/E ratio went as low as 7.5X and as high as 24.1 over the 5-year span. Further, it is sporting a 1.93 on the Price-to-Sales ratio. Compare this with the industry average P/S of 2.2. 45.3 percent is the gross profit margin for Applied Materials, Inc. and operating margin sits at 27.8 percent. Along with this, the net profit margin is 19.2 percent.

On 11th of January, Applied Materials, Inc. (NASDAQ:AMAT) shares ended higher after a volatile session. The shares accumulated 0.02 points or 0.06 percent at $34.78 with a light trade volume of 6.45 million shares. After opening the session at $34.42, the shares went as high as $35.315 and as low as $34.19, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $33.3 billion and now has 958.06 million shares outstanding. Applied Materials, Inc. (AMAT) stock has gained 2.23 percent of market value in 21 trading days.

AMAT stock has a trailing 3-year beta of 1.6, offering the possibility of a higher rate of return, but also posing more risk. The portion of a company’s profit allocated to each outstanding share of common stock was $4.31 a share in the trailing twelve months. The stock’s value has surged 6.23 percent year to date (YTD) against a decline of -34.75 percent in 12 month’s time. The company’s shares still trade -44.26 percent away from its 1-year high of $62.40 and 20.81 percent up from 52-week low of $28.79. The average consensus rating on the company is 2.1, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a sell.