Applied Materials rises on hiring of new president
NEW YORK (AP) — Applied Materials Inc. investors cheered the appointment of a seasoned executive Wednesday.
THE SPARK: The maker of equipment for chip-makers on Tuesday named Gary Dickerson as president. A 30-year industry veteran, he had most recently been CEO of Varian Semiconductor, which Applied Materials acquired last year for $4.9 billion. He didn't come on board then, but is now responsible for day-to-day operations of Applied Material's four business units.
THE BIG PICTURE: Applied Materials said at the time that buying Varian, another semiconductor equipment maker, would help it gain market share and praised its workforce. Applied Materials is facing tough competition in the industries it serves, which include solar energy and flat-panel displays as well as chip-makers.
THE ANALYSIS: Analysts said Dickerson had been a successful CEO at Varian and would give Applied Materials a boost in his new role.
Dickerson's hiring "should bring new ideas and energy" to the company and please investors, said Pacific Crest analyst Weston Twigg. While at Varian, Dickerson had increased market share, kept the company highly profitable and kept customers happy, he said.
Twigg predicted that Dickerson would eventually be promoted to CEO of Applied Materials.
A message left requesting comment from Applied Materials was not immediately returned.
Stifel Nicolaus analyst Patrick Ho backed his "Buy" rating for the company and raised his price target by $2 to $15, saying Dickerson's hiring was a "significant move" that would "reinvigorate" Applied Materials.
THE SHARES: Up 34 cents, or 3 percent, to $11.52 in late afternoon trading. The overall market was slightly lower, with the tech-heavy Nasdaq composite down 0.2 percent.
Over the past 52 weeks, shares of Applied Materials have traded between $9.70 and $13.94. Since the beginning of this year, the shares had risen about 4.4 percent.