Applied MaterialsXTER:AP2 +1.00%81 ROE % is 49.31% as of Apr. 2026, which is 25% above its 10-year median of 39.57. GuruFocus rates XTER:AP2 with a GF Score™ of 81/100 and a GF Value™ of €190.67 (Significantly Overvalued). The stock has 6 warning signs investors should review. Among 1,004 Semiconductors companies, Applied Materials ranks better than 95.52% on this metric.
The historical rank and industry rank for Applied Materials's ROE % or its related term are showing as below:
XTER:AP2'
s ROE % Range Over the Past 10 Years
Min: 23.21 Med: 39.57 Max: 53.39
Current: 40.71
During the past 13 years, Applied Materials's highest ROE % was 53.39%. The lowest was 23.21%. And the median was 39.57%.
XTER:AP2's ROE % is ranked better than 95.52% of 1004
companies
in the Semiconductors industry
Industry Median: 4.55
vs XTER:AP2: 40.71
Applied Materials (XTER:AP2) ROE % Explanation
ROE % measures the rate of return on the ownership interest (shareholder's equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' equity (also known as net assets or assets minus liabilities). ROE % shows how well a company uses investment funds to generate earnings growth. ROE %s between 15% and 20% are considered desirable.
The factors that affect a company's ROE % can be illustrated with the three-step DuPont Analysis:
Note:
The net income data used here is four times the quarterly (Apr. 2026) net income data. The Revenue data used here is four times the quarterly (Apr. 2026) revenue data. The same rule applies to Pre-Tax Income and Operating Income.
* In the five-step DuPont Analysis, Operating Income is only available for non-financial companies. Thus, for Insurance companies, we use EBIT as a substitution of Operating Income. For Banks, both Operating Income and EBIT is unavailable. Thus we combined Interest Burden and Operating Margin % into Pretax Margin %, and the DuPont Analysis is divided into four components instead.
* 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.
Be Aware
Net Income is used.
Because a company can increase its ROE % by having more financial leverage, it is important to watch the equity multiplier when investing in high ROE % companies. Like ROA %, ROE % is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Asset light businesses require very few assets to generate very high earnings. Their ROE %s can be extremely high.
Applied Materials ROE % Related Terms
Applied Materials ROE % Historical Data
* Premium members only.
The historical data trend for Applied Materials's ROE % can be seen below:
* 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.
For the Semiconductor Equipment & Materials subindustry, Applied Materials's ROE %, along with its competitors' market caps and ROE % 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 ROE % vs Semiconductors Industry
For the Semiconductors industry and Technology sector, Applied Materials's ROE % distribution charts can be found below:
* The bar in red indicates where Applied Materials's ROE % falls into.
* 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.
In the calculation of annual ROE %, the net income of the last fiscal year and the average total shareholder equity over the fiscal year are used. In calculating the quarterly data,
the net income data used here is four times the quarterly (Apr. 2026) net income data.
ROE % is displayed in the 30-year financial page.
Applied Materials (XTER:AP2) has a ROE % of 49.31% as of Apr. 2026. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on Applied Materials and its competitors. This is 25% above median its historical median of 39.57. Over the past decade, Applied Materials' ROE % has ranged from 23.21 to 53.39. According to the industry distribution chart, Applied Materials ranks #45 out of 1004 companies in the Semiconductors industry, placing it in the top 4.5%.
Is Applied Materials' ROE % too high?
Applied Materials' current ROE % of 49.31% is 25% above median its 10-year median of 39.57. Over the past 10 years, this metric has ranged from a low of 23.21 to a high of 53.39. The Semiconductors industry median ROE % is 4.55. Applied Materials' value of 49.31% is 983.7% above this industry median. Based on the distribution chart, Applied Materials ranks #45 out of 1004 companies in the Semiconductors industry, which is in the top quartile — a strong position relative to peers. Overall, Applied Materials has a GF Score™ of 81/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Applied Materials' ROE % compare to LRCX and KLAC?
According to the Semiconductors industry distribution chart, Applied Materials ranks #45 out of 1004 companies for ROE %. This places Applied Materials in the top 5% of its industry — outperforming the majority of peers. The industry median ROE % is 4.55. Applied Materials' value of 49.31% is 983.7% above this benchmark. Historically, Applied Materials' own ROE % has ranged from 23.21 to 53.39 over the past decade. While the company's 10-year median is 39.57 vs. the industry median of 4.55, Applied Materials has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROE % for a Semiconductors company?
The median ROE % among Semiconductors companies is 4.55, based on 1,004 companies in the industry. Companies in the top quartile (top 25%) have a ROE % significantly above this median, while those in the bottom quartile fall well below. However, ROE % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Applied Materials's current ROE % of 49.31% is 983.7% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROE % mean?
A high ROE % can signal that a stock is expensive relative to its fundamentals. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on Applied Materials and its competitors. For the Semiconductors industry, the median ROE % is 4.55 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Applied Materials's current ROE % is 49.31%, which is 25% above median its own 10-year median of 39.57. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Applied Materials stock overvalued right now?
Based on GuruFocus' analysis, Applied Materials (XTER:AP2) is currently considered Significantly Overvalued. The stock's GF Value™ is €190.67, compared to a current price of €516.10 — trading 170.7% above its estimated fair value. The current ROE % is 49.31%, which is 25% above median its 10-year median of 39.57 and 983.7% above the Semiconductors industry median of 4.55. Applied Materials' overall GF Score™ is 81/100 with 6 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROE % calculated?
ROE % is calculated from a company's financial statements. For Applied Materials (XTER:AP2), the current ROE % is 49.31% as of Apr. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Applied Materials (XTER:AP2) Overvalued in 2026?
Based on GuruFocus' analysis, Applied Materials stock appears to be overvalued.
The current stock price of €516.10 is trading 170.7% above its estimated GF Value™ of €190.67.
GuruFocus considers Applied Materials to be Significantly Overvalued.
Key valuation signals for XTER:AP2:
ROE %: 49.31% (25% above median its 10-year median of 39.57)
GF Value™: €190.67 vs. price of €516.10 (170.7% above fair value)
Industry Position: 983.7% above the Semiconductors median (#45 of 1004)
No single metric tells the full story. See the XTER:AP2 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Applied Materials is the largest semiconductor wafer fabrication equipment manufacturer in the world. It has a broad portfolio spanning nearly every corner of the WFE ecosystem. Applied Materials holds leading market share in deposition, which entails the layering of new materials on semiconductor wafers. It is more exposed to general-purpose logic chips made at integrated device manufacturers and foundries. It counts the largest chipmakers in the world as customers, including TSMC, Intel, and Samsung.
81GF Score
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