20 Worst Performing AI Stocks of Last Week

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

Weekly Decline: 11.53%

Number of Hedge Fund Holders: 77

Applied Materials, Inc. (NASDAQ:AMAT) is another semiconductor materials and equipment company on our list, based in Santa Clara, California. It provides manufacturing equipment, services, and software to the semiconductor display and related industries.

In its second-quarter earnings report, Applied Materials, Inc. (NASDAQ:AMAT) revealed that it generated revenue of $6.7 billion, up 5% year-over-year. Its GAAP operating margin also increased to 28.7%, up by 0.7 points year-over-year. Finally, the company also generated $2.39 billion in cash from operations. Applied Materials, Inc.’s (NASDAQ:AMAT) CEO noted that this growth was driven by demand for the company’s unique and connected portfolio of products and services, which has positioned the company to outperform the market over the long term.

Despite these positive announcements, Applied Materials, Inc. (NASDAQ:AMAT) actually saw its stock price dip in the aftermath – a dip that has continued into September. The primary reason for this may be that semiconductor stocks are not expected to recover fully in 2024, which means that the real growth will only come about in 2025 or 2026 as the industry absorbs excess inventory left over from 2023. This may be discouraging for investors who expect immense growth from semiconductor stocks, especially in the current AI-frenzied market.

Despite this, most analysts consider Applied Materials, Inc. (NASDAQ:AMAT) to be a stock worth buying, especially in light of its growth potential, which spans over the next couple of years. As such, being put off from the stock simply because it’s playing catch up like every other semiconductor player may not be the best strategic move.

Applied Materials, Inc. (NASDAQ:AMAT) was spotted in the portfolios of 77 hedge funds in the second quarter, with a total stake value of $5.5 billion.