12 Best Nanotechnology Stocks to Buy According to Hedge Funds

4. Applied Materials, Inc. (NASDAQ:AMAT)

Number of Hedge Fund Holders: 74

Applied Materials, Inc. (NASDAQ:AMAT), a leader in nanomanufacturing technology, has carved out a strong niche by engineering advanced equipment and software essential for semiconductor production, LCDs, and solar power solutions. The company’s innovative selective tungsten deposition process, akin to atomic-scale 3D printing, significantly enhances transistor efficiency and performance. With expertise in molecular nanotechnology—manipulating atoms to create precise materials—Applied Materials, Inc. (NASDAQ:AMAT) has successfully met soaring demand for its products, even during global chip shortages.

In fiscal 2024, Applied Materials, Inc. (NASDAQ:AMAT) achieved record-breaking results for the fifth consecutive year, with net sales reaching $27.2 billion, up 2.5% from the prior year. Non-GAAP earnings per share climbed 7.5% to $8.65. For Q1 2025, the company projects revenue of $7.15 billion and non-GAAP EPS of $2.29. Over the past fiscal year, Applied Materials returned more than $5 billion to shareholders through dividends and share buybacks.

In November, TD Cowen adjusted its price target for Applied Materials, Inc. (NASDAQ:AMAT) from $250 to $230 while maintaining a Buy rating. The firm acknowledged the company’s solid gross margin, supported by operational improvements and value-based pricing, but flagged concerns about slower quarter-over-quarter revenue growth compared to peers and potential volatility in end-market demand. Despite these challenges, the company remains well-positioned, bolstered by market share gains in Gate-All-Around (GAA) technology and a leading 25% share in the DRAM and High Bandwidth Memory (HBM) segments.

Parnassus Investments mentioned Applied Materials, Inc. (NASDAQ:AMAT) in its Q3 2024 investor letter. Here is what the fund said:

“Applied Materials, Inc. (NASDAQ:AMAT), the world’s largest supplier of wafer fabrication equipment for semiconductors, saw its shares pressured by negative sentiment around a potentially broad-based trend of capital expenditure cuts in memory spending.”