Here's Why Applied Materials' Crash Will Make You Money
Applied Materials (NASDAQ: AMAT) stock price is down 42% in 2022 thanks to a mix of operational problems, including a shortage of components, as well as the overall gloom in the stock market related to the troubled economy. The stock is also down because the semiconductor equipment supplier's fiscal 2022 second-quarter results (for the three months ended on May 1) were not up to the mark.
Applied Materials' year-over-year revenue growth of 12% last quarter to $6.25 billion and non-GAAP earnings growth of just 13% to $1.85 per share were far cries from the terrific growth it clocked last fiscal year. Its guidance suggested more of the same as Applied Materials is finding it difficult to source components to complete shipments of its machines.
Clearly, Applied Materials is facing some short-term challenges. But savvy investors should be paying more attention to the fact that the company is in the process of solving a major problem -- the global semiconductor shortage. If it does, the sharp stock price decline presents a buying opportunity. Let's see how it's solving the problem and what it could mean down the road for the stock.
Source Fool.com
