HScreen · AMAT

AMAT · Applied Materials, Inc. 6d old

conviction2

coverage tierT3-PRIMARY-COMPLETE

horizon12 months

Return distribution probability-weighted scenarios, never collapsed to a point

-30%20%

+10%42%

+50%38%

EV +17.20%

why these probabilities: All legs priced off 505.17 USD (2026-08-18), ~800m diluted shares, FY2025 reported EPS 8.71, and the dated consensus table at fmp:/stable/analyst-estimates?symbol=AMAT&period=annual (as_of 2026-08-19, 53 covering analysts). Consensus EPS growth: FY2026 +31.2%, FY2027 +38.7%, FY2028 +28.8%, giving EPS of 11.43 / 15.84 / 20.40. Horizon end is Aug-2027, when the market prices FY2028 as NTM. Current multiple 44x FY2026e, 32x FY2027e. BASE — the market's expectation, delivered, and this leg is DESCRIPTIVE not predictive: consensus revenue growth of ~18.3% in FY2026 and ~28.9% in FY2027 lands, FY2028e EPS of 20.40 is on the screen at the horizon, and the multiple compresses modestly from 32x to 27x NTM EPS as late-cycle semicap forward multiples normally do. 20.40 x 27 = 551, i.e. +9.0%, plus ~2.12 of dividends (0.4%) = +10%. BULL — growth MATERIALLY FASTER than the market expects: FY2027 revenue growth ~38% against consensus ~28.9%, on evidence the five-year history does not contain — TSMC 2027 capex guided by supplier feedback to +40% (USD 76-80bn), the guided "significant uplift from leading edge", memory shortage pulling DRAM/HBM capacity forward, and AMAT compounding its +300bp etch share. FY2027 EPS 18.50, FY2028e 24.00, and that growth earns 31.5x rather than 27x: 24.00 x 31.5 = 756, i.e. +50%. BEAR — growth MATERIALLY SLOWER, not a collapse: FY2027 revenue growth decelerates

not built — options-implied distribution on the same axis, with the KL number and where the disagreement sits
needs: desk-options implied bands (v1.4 Part 4a) — activates at 60% coverage; currently 33%

Visibility how far ahead this name can be seen

not built — visibility score
needs: visibility_score.py

Trust how much weight this name's own record can carry (credibility Z)

not built — credibility
needs: credibility.py

Sizing survival-first size (half-Kelly) vs the enforced ladder

kelly not computable — no data

Falsifiers what would prove this wrong

Tier-4 customers fund the 2027 capex step-up that the growth score rests on, rather than pushing equipment deliveries right
Gross margin expansion continues; the 13-consecutive-quarter streak of YoY expansion does not break
AMAT holds or extends its conductor etch share gain and does not lose core deposition share to Lam
AGS operating margin holds at or near 30%, preserving the annuity that floors the bear leg
China export-licence restrictions do not tighten further onto AMAT's shippable WFE portfolio
Capex declines as a percentage of revenue as guided, so FCF conversion improves

Conflicts surfaced, never netted out (T4)

Consensus is Buy with 42 of 53 analysts at buy-or-better and a 675.65 target implying +33.7%. My probability-weighted expectation is +17.2%. I do not disagree with the street's growth path — I anchor the base case to it	high
The revision tape is UNAVAILABLE, not neutral: eps_drift and rev_drift both return n_up 0, n_down 0, breadth 0.0, direction flat, median_move_pct null over a 365-day window. So the independent cross-check on whether cons	high
Consensus disagrees with itself where my thesis lives. FY2027 revenue dispersion is 23.5% across 26 estimates and FY2028 is 39.6% across 20, versus 0.4% for FY2025. The point estimate for the exact period my scenarios tu	high
My quality score of 8 rests partly on AMAT's +300bp conductor etch share gain, while third-party technical research states Lam is dominating molybdenum deposition and taking share FROM AMAT tungsten tools. Both are true	medium
No signal desk exists to agree or disagree with. Four of the five cross-checks the system is designed to run against an analyst view are structurally unavailable, and no options-implied probability was obtainable for eit	medium

The case against independent adversary, different model family (P6) broken

Version history from the research record

archived versions1

archived	hash	bytes
2026-08-19T08:32:01	4e74d6ed8ac7	27,036

One version only — the archive was created today. The diff view fills in on the next re-run.

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