Applied Materials down; Morgan Stanley expects co to grow in line with chipmaking tools

Shares of chipmaking tools supplier Applied Materials AMAT.O down 1.2% at $318.35 premarket

Morgan Stanley notes current market perception implies AMAT will continue to undergrow wafer fabrication equipment (WFE), but says it expects AMAT to grow roughly in-line with WFE

Raises PT to $364 from $273, a ~13% upside to stock's last close

To sustainably outgrow WFE, co would need either a rebound in its ICAPS segment, which covers a broad range of chips including mature and specialty devices, or a material outpeformance in leading-edge logic and DRAM businesses - Brokerage

Co is scheduled to report Q1 results on February 12 after market close

AMAT rose ~58% in 2025