Monday, September 28, 2009

Applied Materials: Upgraded to Buy at Citigroup; Added to Top Picks List (AMAT)

The stock is up 3% at $13.50. From Notable Calls:
Citigroup's Semi Equipment team is upgrading Applied Materials (NASDAQ:AMAT) to Buy from Hold and adding it to Top Picks Live (Citi’s focus list) based on significant new SunFab wins, upcoming cost savings and a renewed focus on silicon share....
...Positive Catalysts Align — Based on checks at the Hamburg solar show, Citigroup now believes AMAT is about to sign a significant second wave of SunFab lines including four new lines (~300MW total) in India. While the ultimate success of SunFab remains debatable given how fast pricing is collapsing, the addition of new customers, more clarity on its cost cutting and up to ~$1B savings (mostly focused in sales/service/solar), some undiscovered margin leverage headed into 2010 and its new-found focus on regaining silicon share should be enough to drive the stock higher. Lastly, as the largest equipment provider to the global solar industry, it should benefit from big MW growth in 2010 and simultaneously avoid most of the pricing compression that will continue to plague cell/module makers.....MORE