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Applied Materials Financial Strength

: 7 (As of Apr. 2022)
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Applied Materials has the Financial Strength Rank of 7.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Applied Materials's Interest Coverage for the quarter that ended in Apr. 2022 was 32.66. Applied Materials's debt to revenue ratio for the quarter that ended in Apr. 2022 was 0.23. As of today, Applied Materials's Altman Z-Score is 8.47.


Competitive Comparison

For the Semiconductor Equipment & Materials subindustry, Applied Materials's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Applied Materials Financial Strength Distribution

For the Semiconductors industry and Technology sector, Applied Materials's Financial Strength distribution charts can be found below:

* The bar in red indicates where Applied Materials's Financial Strength falls into.



Applied Materials Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Applied Materials's Interest Expense for the months ended in Apr. 2022 was $-58 Mil. Its Operating Income for the months ended in Apr. 2022 was $1,894 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Apr. 2022 was $5,768 Mil.

Applied Materials's Interest Coverage for the quarter that ended in Apr. 2022 is

Interest Coverage=-1*Operating Income (Q: Apr. 2022 )/Interest Expense (Q: Apr. 2022 )
=-1*1894/-58
=32.66

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Applied Materials's Debt to Revenue Ratio for the quarter that ended in Apr. 2022 is

Debt to Revenue Ratio=Total Debt (Q: Apr. 2022 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(82 + 5768) / 24980
=0.23

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Applied Materials has a Z-score of 8.47, indicating it is in Safe Zones. This implies the Z-Score is strong.

Good Sign:

Altman Z-score of 8.47 is strong.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Applied Materials  (NAS:AMAT) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Applied Materials has the Financial Strength Rank of 7.


Applied Materials Financial Strength Related Terms

Thank you for viewing the detailed overview of Applied Materials's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Applied Materials Business Description

Applied Materials logo
Address
3050 Bowers Avenue, P.O. Box 58039, Santa Clara, CA, USA, 95052-8039
Applied Materials is the world's largest supplier of semiconductor manufacturing equipment, providing materials engineering solutions to help make nearly every chip in the world. The firm's systems are used in nearly every major process step with the exception of lithography. Key tools include those for chemical and physical vapor deposition, etching, chemical mechanical polishing, wafer- and reticle-inspection, critical dimension measurement, and defect-inspection scanning electron microscopes.
Executives
Hill Brice officer: SVP, CFO 2100 LOGIC DRIVE SAN JOSE CA 95124
Borkar Rani director C/O APPLIED MATERIALS, INC. 3050 BOWERS AVE, PO BOX 58039 SANTA CLARA CA 95052
Little Teri A. officer: SVP, CLO ONE TECHNOLOGY DRIVE MILPITAS CA 95035
Mcgill Yvonne director ONE DELL WAY ROUND ROCK TX 78682
Mcgregor Scott A director 5300 CALIFORNIA AVENUE IRVINE CA 92617
Raja Prabu G. officer: SVP, Semi. Products Group C/O APPLIED MATERIALS, INC. 3050 BOWERS AVENUE, P.O. BOX 58039 SANTA CLARA CA 95052
Ghanayem Steve G. officer: SVP, New Mrkts & Alliances Grp C/O APPLIED MATERIALS, INC. 3050 BOWERS AVENUE, P.O. BOX 58039 SANTA CLARA CA 95052
Durn Daniel officer: Senior VP C/O APPLIED MATERIALS, INC. 3050 BOWERS AVENUE, P.O. BOX 58039 SANTA CLARA CA 95052-8039
Bruner Judy director C/O SANDISK CORPORATION 601 MCCARTHY BLVD. MILPITAS CA 95035
Ma Adrianna director 10375 RICHMOND AVENUE SUITE 1910 HOUSTON TX 77042
Chen Xun director 35 DORY RD. GLOUCESTER MA 01930
Thakur Randhir officer: EVP & GM, Silicon Systems C/O APPLIED MATERIALS, INC. 3050 BOWERS AVENUE, P.O. BOX 58039 SANTA CLARA CA 95052-8039
Dickerson Gary E director, officer: President and CEO
Nalamasu Omkaram officer: Senior VP, CTO C/O APPLIED MATERIALS, INC. 3050 BOWERS AVENUE, P.O. BOX 58039 SANTA CLARA CA 95052-8039
Addiego Ginetto officer: SVP, Engineering 4000 NORTH FIRST STREET SAN JOSE CA 95134

Applied Materials Headlines

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