Street View: China hurdles impact Applied Materials, but outlook remains strong

** Applied Materials AMAT.O forecast fourth-quarter revenue and profit below estimates on Thursday, citing weak demand in China and erratic orders from customers facing uncertainty due to tariffs

** The semiconductor equipment maker expects revenue of $6.70 billion, plus or minus $500 million, for the fourth quarter, compared with analysts' average estimate of $7.33 billion, according to data compiled by LSEG

** Shares of co fall 14.25% to $161.42 in premarket trade

PATTERNING THE FUTURE, STUMBLING IN THE PRESENT

** J.P.Morgan ("overweight," PT: $220) expects AMAT to underperform this year due to its heavy exposure to China, weakness in ICAPS segment, and uneven spending in advanced foundry and logic

** Citigroup ("buy," PT: $205) says AMAT's leading-edge patterning portfolio may be dragging down its product mix compared to stronger results from peers like KLA KLAC.O and Lam Research LRCX.O

** Believes AMAT is taking a cautious approach to China

** Berenberg ("buy," PT: $240) believes AMAT will benefit from upcoming spending by display makers like Samsung 005930.KS, especially as mobile-related display investments begin to recover

** Morningstar (fair value: $196) says AMAT is well-positioned to benefit from AI-driven demand for leading-edge logic and DRAM equipment over the medium term

** Remains confident in AMAT's long-term outlook despite weaker short-term guidance