Nasdaq Composite Gains 111% Over Three Years, Driven by AI Adoption
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Source: Fool
- Nasdaq Outperformance: The Nasdaq Composite has surged 111% over the past three years, significantly outpacing the S&P 500's 74% increase, reflecting robust growth in the tech sector driven by widespread AI adoption, a trend expected to continue into 2026.
- Global AI Spending Surge: According to Gartner, global AI spending is projected to reach $2.5 trillion in 2023, marking a nearly 44% increase from last year, with an anticipated 32% growth in 2027, providing strong growth momentum for tech stocks.
- Positive Outlook for Applied Materials: Shares of Applied Materials (AMAT) have risen 72% in the past six months, fueled by strong demand for AI-specific semiconductor equipment, with semiconductor equipment sales expected to increase from $133 billion to $145 billion in 2026, driving revenue growth.
- SentinelOne Acquisition Boosts Growth: SentinelOne's acquisition of Observo AI for $225 million enhances its real-time threat detection capabilities, with Q3 revenue up 23% year-over-year to $259 million, and expectations for future growth to exceed market forecasts, potentially driving a 48% stock price increase.
Analyst Views on AMAT
Wall Street analysts forecast AMAT stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for AMAT is 288.05 USD with a low forecast of 190.00 USD and a high forecast of 425.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
22 Analyst Rating
18 Buy
4 Hold
0 Sell
Strong Buy
Current: 318.785
Low
190.00
Averages
288.05
High
425.00
Current: 318.785
Low
190.00
Averages
288.05
High
425.00
About AMAT
Applied Materials, Inc. is a materials engineering solution company. The Company provides equipment, services and software to the semiconductor, display, and related industries. It operates in three segments: Semiconductor Systems, Applied Global Services (AGS), and Display. The Semiconductor systems segment designs, develops, manufactures and sells a range of primarily 300 mm equipment used to fabricate semiconductor chips, also referred to as integrated circuits (ICs). The AGS segment provides services, spares and factory automation software to customer fabrication plants globally. The AGS segment also manufactures and sells 200mm and other equipment. The Display segment is comprised primarily of products for manufacturing liquid crystal displays (LCDs), organic light-emitting diodes (OLEDs), and other display technologies for televisions, monitors, laptops, personal computers (PCs), tablets, smartphones, and other consumer-oriented devices.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
