Applied Materials Stock Surges as AI Demand Fuels Record Run

While U.S. markets observed the Thanksgiving holiday, Applied Materials continued building momentum for its next growth phase. The semiconductor equipment manufacturer is achieving consecutive record performances, propelled by unexpectedly optimistic forecasts that could further accelerate the artificial intelligence boom. Investors now question whether this upward trajectory will sustain when trading resumes on Friday.

While many investors focus primarily on AI processors, the memory chip market appears poised to deliver significant surprises. Analysis from UBS suggests the market currently underestimates equipment demand originating from China. This resilient Asian demand, combined with anticipated spending increases, creates a potent growth combination.

Applied Materials stands positioned as the primary beneficiary of this memory sector expansion. UBS researchers project that DRAM-related equipment expenditures will grow by approximately $13 billion next year, creating substantial revenue opportunities for the equipment manufacturer.

UBS Upgrade Provides Substantial Momentum

The investment bank UBS has delivered a significant boost to Applied Materials' market prospects. Analyst Timothy Arcuri elevated his rating from "Neutral" to "Buy" while substantially increasing the price target from $250 to $285. The rationale behind this upgrade warrants attention: UBS anticipates a "significantly more bullish outlook" for wafer fab equipment spending in 2026 and 2027.

The recent quarterly results released on November 13 offered preliminary evidence of this positive trend. Despite a slight revenue decline of 3% to $6.80 billion, the company expanded its gross margin to 47.5%. This performance demonstrates Applied Materials' ability to maintain profitable growth despite short-term market challenges.

Should investors sell immediately? Or is it worth buying Applied Materials?

Technical Position and Market Activity

Closing at $249.87 on Wednesday, Applied Materials shares hover just below the psychologically significant $250 threshold. The stock reached an intraday 52-week high of $252.66, reflecting strong investor enthusiasm confirmed by trading volume exceeding 8.7 million shares—well above average levels.

However, not all indicators point unequivocally upward. Prior to the record peak, Senior Vice President Teri A. Little sold 4,000 shares at an average price of $238.24. While this transaction represents only a small portion of her holdings, insider sales remain a closely monitored indicator for market participants.

Future Trajectory and Market Outlook

The critical test arrives Friday when U.S. markets reopen post-holiday: Can Applied Materials establish a firm footing above the $250 mark? The UBS price target of $285 suggests potential upside of 14% remains, though the stock must first consolidate its recent gains.

Operating in an industry transformed by the AI revolution, Applied Materials continues strengthening its position as an essential supplier to the semiconductor sector. Whether the anticipated memory boom materializes in 2026 as expected will substantially influence the company's share price direction in coming months.