), and says the company is its "single best idea," after an upbeat analyst meeting.
Analyst James Covello notes Applied Materials gave quite an upbeat outlook on the current recovery in the chip equipment sector. He reiterates his rating due to the company's strong position in 300mm, emerging markets, and relative valuation. Covello felt the company did an excellent job of addressing concerns about the cycle in general, as well as Applied Materials' outlook in particular, including the supposed declining capital intensity of the business at 300mm, market share gains and losses, the company's position in and dependence on China, as well as whether the next cycle peak margins will reach the previous peak levels. Covello has a $75 peak stock price for this cycle. Applied Materials set a two-for-one stock split.