BofA’s List Of AI & Semiconductor Stocks That Fund Managers Love & Hate: 16 Stocks On The Manager Radar

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

Number of Hedge Fund Holders In Q2 2024: 77

Section: Gaining Popularity

Applied Materials, Inc. (NASDAQ:AMAT) is an American semiconductor manufacturing equipment provider. Its products are involved directly in the chip manufacturing process. They also enable fabs to optimize production. Consequently, Applied Materials, Inc. (NASDAQ:AMAT)’s stock is at the mercy of the broader semiconductor industry. The shares are up a modest 18.6% year to date, and the bearishness is driven by the firm’s exposure to China. During Applied Materials, Inc.’s (NASDAQ:AMAT) fiscal third quarter, its China revenue dropped from 43% in Q2 to 32% and led to mixed investor reactions despite the overall $6.78 billion in revenue beating analyst estimates of $6.67 billion. Part of this drop was also because of management reducing its China exposure since Applied Materials, Inc. (NASDAQ:AMAT) has come under US government scrutiny for its Chinese operations. Yet, the firm counts big-ticket names such as Samsung, TSMC, ASML, and Intel as its customers which sets it up well for any upcycles in the chip industry stemming from leading-edge manufacturing technologies such as Intel’s 18A and TSMC’s 2 nanometers.

Parnassus Investments mentioned Applied Materials, Inc. (NASDAQ:AMAT) in its Q2 2024 investor letter. Here is what the fund said:

“Applied Materials is the world’s largest supplier of wafer fabrication technologies used in semiconductor manufacturing. The company reported solid earnings for the quarter, and investors believe Applied Materials should continue to benefit from accelerated industry spend due to AI and share gains.”