Shares of semiconductor manufacturing equipment maker Applied Materials (NASDAQ: AMAT) are tumbling today, down by 4.8% as of 12:35 p.m. ET after it was reported that investment bank Berenberg cut its target price 23% to $120 a share.

Applied Materials stock was already under pressure before the price-target cut, suffering from negative sentiment over U.S. government restrictions on the sale of advanced semiconductor manufacturing equipment to China. As my fellow Fool.com contributor John Ballard pointed out yesterday, these restrictions could cost Applied Materials anywhere from $250 million to $550 million in missed sales in the current quarter.

And now, investors have a new thing to worry about: As The Fly reports, according to Berenberg, there's a new "bear thesis" floating around about Applied Materials, suggesting that "no further innovation [in semiconductor manufacturing equipment] is needed as we are hitting the limitations" on how small semiconductors can be made. To an extent, Berenberg agrees with this thesis, admitting that higher-tech manufacturing equipment doesn't seem to be resulting in significant cost savings in chip manufacturing among Applied Materials' customers, which may impact sales and justify a lower stock price.  

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Source Fool.com