July 01, 2025 a 03:31 am
AMAT: Dividend Analysis - Applied Materials, Inc.
Applied Materials, Inc. showcases a strong dividend history, having consistently delivered payouts for over two decades. Despite a relatively modest yield, the company's disciplined payout ratio and consistent growth in dividends reflect its commitment to shareholder value. Such financial health and resilience in dividend payments make it an enticing prospect for income investors.
📊 Overview
The dividend overview reveals Applied Materials as a player in the tech sector with a distinct emphasis on shareholder returns. The company's sector and key metrics will reveal the intricacies of its dividend strategy.
| Metric | Details |
|---|---|
| Sector | Technology |
| Dividend yield | 0.94% |
| Current dividend per share | 1.44 USD |
| Dividend history | 21 years |
| Last cut or suspension | None |
📉 Dividend History
A robust dividend history builds investor confidence and underscores reliability. This stability often indicates sound financial management and supports the stock's attractiveness to long-term income-focused investors.
| Year | Dividend per Share (USD) |
|---|---|
| 2025 | 1.32 |
| 2024 | 1.52 |
| 2023 | 1.22 |
| 2022 | 1.02 |
| 2021 | 0.94 |
📈 Dividend Growth
Dividend growth rates provide insights into future potential payout increases, thereby enhancing income streams for investors.
| Time | Growth |
|---|---|
| 3 years | 17.37% |
| 5 years | 12.86% |
The average dividend growth is 12.86% over 5 years. This shows moderate but steady dividend growth.
✅ Payout Ratio
Payout ratios reflect the sustainability of dividend payments concerning the company's earnings and cash flows. A lower ratio suggests a healthier balance.
| Key figure | Ratio |
|---|---|
| EPS-based | 17.30% |
| Free cash flow-based | 19.49% |
With a payout ratio of 17.30% (EPS) and 19.49% (FCF), Applied Materials maintains a conservative stance, indicating a strong capacity to cover its dividend payments while retaining earnings for growth opportunities.
📊 Cashflow & Capital Efficiency
Evaluating cash flow and capital efficiency helps assess a company's ability to generate cash flows and manage its financial resources effectively.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 4.88% | 6.90% | 5.99% |
| Earnings Yield | 4.68% | 6.23% | 8.48% |
| CAPEX to Operating Cash Flow | 13.71% | 12.71% | 14.58% |
| Stock-based Compensation to Revenue | 2.12% | 1.85% | 1.60% |
| Free Cash Flow / Operating Cash Flow Ratio | 86.29% | 87.29% | 85.42% |
The cash flow metrics reveal consistent operational efficiency, underlining robust cash flow management which supports dividend payments and potential reinvestments.
🗣️ Balance Sheet & Leverage Analysis
Assessing balance sheet strength and leverage assists in understanding a company's financial health and its ability to meet obligations.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 32.94% | 36.69% | 47.80% |
| Debt-to-Assets | 18.19% | 19.52% | 21.81% |
| Debt-to-Capital | 24.78% | 26.84% | 32.34% |
| Net Debt to EBITDA | -0.21 | -0.01 | 0.46 |
| Current Ratio | 0.00 | 0.00 | 0.00 |
| Quick Ratio | 1.87 | 1.82 | 1.35 |
| Financial Leverage | 1.81 | 1.87 | 2.19 |
The leverage metrics indicate conservative use of debt, allied with strong liquidity, which enhances financial flexibility and reduces risk exposure.
📈 Fundamental Strength & Profitability
Fundamental metrics shed light on the company's profitability and operational performance, crucial for evaluating long-term viability.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 37.77% | 41.93% | 53.51% |
| Return on Assets | 20.86% | 22.31% | 24.41% |
| Margins: Net | 26.41% | 25.86% | 25.31% |
| EBIT | 30.91% | 29.96% | 30.35% |
| EBITDA | 30.39% | 31.89% | 32.03% |
| Gross | 47.46% | 46.70% | 46.51% |
| R&D to Revenue | 11.90% | 11.70% | 10.75% |
High profitability ratios and ongoing investment in R&D indicate efficient operations and commitment to innovation, which can foster sustained growth.
📉 Price Development
✅ Dividend Scoring System
| Category | Score | Score Bar |
|---|---|---|
| Dividend yield | 3 | |
| Dividend Stability | 5 | |
| Dividend Growth | 4 | |
| Payout Ratio | 5 | |
| Financial Stability | 4 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 4 |
Overall Score: 34/40
📊 Rating
Based on the dividend scoring and fundamental analysis, Applied Materials, Inc. demonstrates a strong dividend profile. Its stable payouts, coupled with a low payout ratio and robust growth prospects, align it as a reliable investment for dividend-seeking portfolios.