Applied Materials, Inc. (AMAT) vs KLA Corporation (KLAC)

Applied Materials, Inc. and KLA Corporation are both Semiconductor Equipment & Materials companies. Applied Materials, Inc. is the larger, with a market value of $382.9B against $248.2B — 1.5× the size. Applied Materials, Inc. trades at the lower P/E: 41.6× against 51.1×. KLA Corporation grew revenue faster over the last twelve months: 11.7% against 7.77%. KLA Corporation has the higher net margin (35.6% vs 30.1%) and the higher return on invested capital (48.2% vs 24.9%). Both pay a dividend; KLA Corporation yields more (0.91% vs 0.71%). Across the 23 metrics below, KLA Corporation leads on 15 and Applied Materials, Inc. on 8.

Valuation

Metric AMAT KLAC Semiconductor Equipment & Materials median
P/E 41.56 51.08 54.39
P/S 12.49 18.16 6.08
P/B 15.03 38.83 4.89
Price to free cash flow 66.95 65.65 60.92
EV/EBITDA 39.55 41.01 39.95
EV/Sales 12.40 18.29 6.36
Earnings yield 2.41% 1.96% 1.14%
Free cash flow yield 1.49% 1.52% 1.28%

Profitability

Metric AMAT KLAC Semiconductor Equipment & Materials median
Gross margin 49.40% 61.30% 43.95%
Operating margin 29.64% 41.69% 10.32%
Net margin 30.05% 35.57% 7.45%
Free cash flow margin 18.25% 27.74% 6.77%
Return on equity 41.07% 87.50% 4.78%
Return on assets 23.84% 28.40% 3.62%
Return on invested capital 24.91% 48.24% 6.10%

Growth

Metric AMAT KLAC Semiconductor Equipment & Materials median
Revenue growth (TTM) 7.77% 11.71% 14.60%
EPS growth (last fiscal year) 0.58% 20.51% —
Revenue growth, 5-year CAGR 10.52% 14.44% 8.85%
Net income growth, 5-year CAGR 14.10% 18.38% 0.00%

Health

Metric AMAT KLAC Semiconductor Equipment & Materials median
Debt to equity 0.26 0.93 0.09
Current ratio 2.42 2.88 3.66
Net debt to EBITDA (0.23) 0.16 (0.49)

Dividend

Metric AMAT KLAC Semiconductor Equipment & Materials median
Dividend yield 0.71% 0.91% 0.85%
Payout ratio 0.15 0.22 0.00

Size

Metric AMAT KLAC Semiconductor Equipment & Materials median
Market cap 382.88b 248.19b 4.63b

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