We publish no single base value for Applied Materials. Our valuation methods put it between $123.92 and $195.79 a share. The valuation code's reason: no point fair value: the two anchors behind it compound the same growth rate and differ only in how they end — a perpetuity at the terminal rate against a multiple on the final year — so the midpoint between them measures terminal treatment rather than what the business is worth. The published range is the same reading with the false precision removed: read it as the span the method supports, and treat neither edge as a point estimate.
| Method | Value | vs price | Basis |
|---|---|---|---|
| Discounted cash flow | $123.92 | -67.5% | free cash flow $5.62bn, growth 7.77% for 5 years, then fading to 3% over 5 more, discounted at 11.25%; plus net cash $8.94 a share; stress floor $83.00 |
| Exit multiple (P/E) | $195.79 | -48.6% | earnings per share $12.79 valued at 20.05× (the stock's own median P/E) in 5 years, discounted back |
| Sum of the parts | — | — | no sum of the parts: this run holds no segment disclosure for the name |
| Price to sales | — | — | not reached: the cash-flow or earnings methods produced an anchor, so this fallback was not run |
| Tangible book | — | — | used only for lenders, where book value is the business |
| Price to FFO (REITs) | — | — | used only for REITs |
Each working is rebuilt by code from the valuation's own figures and checked against the published value.
The discount rate:
| Risk-free rate | 5.13% (10-year US Treasury yield) |
| Company's own beta | 1.65 (5 years of monthly returns against the S&P 500; standard error 0.37) |
| Peer beta | 1.32 (median of 73 S&P 500 Information Technology companies) |
| Blend of own and peers | 1.54 (65% own, 35% peers, weighted by how precisely the company's own beta is measured) |
| Adjusted beta | 1.36 (0.67 × 1.54 + 0.33, pulled toward the market's 1.0) |
| Equity risk premium | 4.5% |
| Discount rate = risk-free + adjusted beta × premium | 11.25% |
Free cash flow grows 7.77% a year for 5 years, then fades in equal steps toward 3% over 5 more; each year is discounted by 1 ÷ (1 + rate)^year:
| Year | Growth | Free cash flow | Discount factor | Present value |
|---|---|---|---|---|
| Now | — | $5.62bn | — | — |
| Year 1 | 7.77% | $6.06bn | 0.8989 | $5.45bn |
| Year 2 | 7.77% | $6.53bn | 0.8080 | $5.27bn |
| Year 3 | 7.77% | $7.04bn | 0.7263 | $5.11bn |
| Year 4 | 7.77% | $7.58bn | 0.6528 | $4.95bn |
| Year 5 | 7.77% | $8.17bn | 0.5868 | $4.80bn |
| Year 6 | 6.97% | $8.74bn | 0.5275 | $4.61bn |
| Year 7 | 6.18% | $9.28bn | 0.4741 | $4.40bn |
| Year 8 | 5.38% | $9.78bn | 0.4262 | $4.17bn |
| Year 9 | 4.59% | $10.23bn | 0.3831 | $3.92bn |
| Year 10 | 3.79% | $10.62bn | 0.3443 | $3.66bn |
| Terminal value = year-10 cash flow × (1 + 3%) ÷ (11.25% − 3%) | $132.57bn |
| Terminal value in today's money | $45.65bn |
| Present value of years 1–10 | $46.33bn |
| Total present value | $91.98bn |
| Shares outstanding | 800.00m |
| Cash flows per share = total ÷ shares | $114.98 |
| Plus net cash per share | $8.94 |
| Value per share | $123.92 |
How the DCF value moves with the discount rate and the starting growth (the middle cell is the published value):
| Discount rate | Growth 2.77% | Growth 7.77% | Growth 12.77% |
|---|---|---|---|
| 10.25% | $107.43 | $140.70 | $184.72 |
| 11.25% | $95.52 | $123.92 | — |
| 12.25% | $86.19 | $110.80 | — |
The same DCF at each beta, starting growth unchanged:
| Beta | Value | Discount rate | DCF value |
|---|---|---|---|
| Company's own beta | 1.65 | 12.55% | $107.35 |
| Peer beta | 1.32 | 11.07% | $126.63 |
| Adjusted beta (used) | 1.36 | 11.25% | $123.92 |
Earnings per share grow on the same fading path as the DCF:
| Year | Growth | Earnings per share |
|---|---|---|
| Now | — | $12.79 |
| Year 1 | 7.77% | $13.79 |
| Year 2 | 6.10% | $14.63 |
| Year 3 | 5.02% | $15.36 |
| Year 4 | 4.31% | $16.02 |
| Year 5 | 3.85% | $16.64 |
| Earnings per share in year 5 | $16.64 |
| Exit P/E (the stock's own median P/E) | 20.05× |
| Value in 5 years = earnings × P/E | $333.65 |
| Discounted at 11.25% over 5 years: ÷ 1.7041 | $195.79 |
We publish no single base value for Applied Materials. Our valuation methods put it between $123.92 and $195.79 a share. The valuation code's reason: no point fair value: the two anchors behind it compound the same growth rate and differ only in how they end — a perpetuity at the terminal rate against a multiple on the final year — so the midpoint between them measures terminal treatment rather than what the business is worth. The published range is the same reading with the false precision removed: read it as the span the method supports, and treat neither edge as a point estimate.
One-year price simulation: a 10% chance the price is below $152.42 and a 10% chance it is above $786.36 in a year; a 44% chance it is higher than today's $380.95, from 63.69% volatility. The simulation assumes the price drifts up at our discount rate of 11.25% a year.
At $380.95 the price implies free cash flow growing 29.1% a year for five years and then fading toward 3% over five more; its revenue has grown 7.8%.
| Week | Price | Base value |
|---|---|---|
| 2 Oct 2026 | $540.04 | $172.23 |
| 9 Oct 2026 | $507.03 | $172.80 |
| 16 Oct 2026 | $409.29 | — |
| 23 Oct 2026 | $377.24 | — |
| 30 Oct 2026 | $390.09 | — |
| 6 Nov 2026 | $332.72 | — |
| 12 Nov 2026 | $380.95 | — |
Data as of 12 Nov 2026; financials to 31 Jul 2026. Sources: company filings via EODHD, SEC EDGAR, US Treasury. How these values are computed. Not investment advice.
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