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AMAT vs TSM
Which Stock Would AI Choose? Applied Materials (AMAT) vs. Taiwan Semiconductor Manufacturing Company (TSM) Stock Comparison
Key Takeaways
- AMAT supplies the manufacturing equipment used to build chips, while TSM is the world's largest contract chipmaker (foundry), giving the two companies complementary rather than identical roles in the AI supply chain.
- Both stocks have been lifted by heavy artificial intelligence (AI) infrastructure spending, but their recent momentum and volatility profiles differ meaningfully.
- AMAT has delivered a larger year-to-date gain but pulled back sharply from recent highs, reflecting higher volatility despite strong fundamentals.
- TSM trades near record levels with steadier relative performance and trades around 20 times forward earnings.
- Risk profiles contrast sharply: AMAT depends on customer capital spending, while TSM faces geographic concentration and margin-dilution risks from overseas capacity and its 2-nanometer ramp.
Introduction
Applied Materials and Taiwan Semiconductor Manufacturing Company are two of the most important names in the semiconductor industry, yet they occupy different positions in the value chain. This stock comparison is relevant to investors and traders seeking to understand how equipment suppliers and chip manufacturers perform in the current market environment driven by AI computing demand. Because both companies are sensitive to the same broad technology cycle but respond to different catalysts, examining their relative performance and market positioning side by side offers a useful lens on the AI trade. The comparison is particularly relevant for those weighing growth momentum against valuation and stability.
AMAT Overview and Recent Performance
AMAT, or Applied Materials, is a leading supplier of wafer fab equipment (WFE), the machinery used to manufacture semiconductors, along with related services and software. Its customers include foundries and memory chipmakers. In recent weeks, the company has benefited from accelerating AI infrastructure build-out, which is driving demand for leading-edge logic chips, DRAM (dynamic random-access memory), and advanced packaging such as high-bandwidth memory (HBM).
Applied Materials has posted record quarterly revenue and repeatedly raised its growth outlook for its semiconductor systems business to more than 30% for the calendar year, up from an earlier target of roughly 20%. Management also expects advanced packaging revenue to grow more than 70% this year. The company raised its quarterly dividend by 15%, marking nine consecutive years of increases. Despite these positive developments, AMAT shares have been volatile in recent market activity, surging strongly earlier in the year before pulling back from their highs as investors reassessed valuation.
TSM Overview and Recent Performance
TSM, or Taiwan Semiconductor Manufacturing Company, is the world's largest dedicated semiconductor foundry, manufacturing chips designed by companies such as Nvidia, AMD, Apple, and Broadcom. It held roughly 72% of the global foundry market in recent quarters. The company has reported record revenue of about $46.7 billion in its most recent quarter, up approximately 50% year over year, driven by AI and high-performance computing demand.
TSMC has guided for full-year revenue growth of more than 30%, with some analysts expecting that forecast to be raised toward the low-to-mid 40% range. The company has increased its capital spending plan to between $60 billion and $64 billion for the year and is investing heavily in U.S. capacity in Arizona, while evaluating further expansion in Texas. TSM shares have climbed about 33% year to date and recently reached record levels, though the stock has also shown sensitivity to margin-dilution concerns tied to the 2-nanometer ramp and overseas fabs.
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Head-to-Head Comparison
The two companies differ fundamentally by business model. AMAT is an equipment supplier that sells "picks and shovels" into the semiconductor manufacturing boom, while TSM is a manufacturer that owns and operates the fabrication capacity itself. This means AMAT's revenue depends on customers' capital expenditure decisions, whereas TSM's revenue depends on utilization and pricing across its foundry network.
On growth drivers, both are leveraged to AI, but through different levers. Applied Materials gains as chipmakers add manufacturing steps, adopt advanced packaging, and expand DRAM and HBM capacity. TSMC gains as AI accelerators require leading-edge nodes such as 3-nanometer and the emerging 2-nanometer technology, alongside advanced packaging. On recent momentum, AMAT has shown stronger but choppier price action, while TSM has trended more steadily near highs.
Risk factors also diverge. AMAT faces cyclical exposure to equipment orders and memory customer concentration. TSM faces geopolitical concentration in Taiwan, overseas fab margin dilution, and the cost of the 2-nanometer ramp. From a valuation and sentiment standpoint, TSM trades at a relatively moderate forward earnings multiple with broad analyst support, while AMAT carries a higher price-to-sales ratio reflecting elevated growth expectations.
Tickeron AI Verdict
Based on observable factors such as trend consistency, stability, catalysts, and relative positioning, Tickeron's AI would currently lean toward TSM. The foundry giant has demonstrated a steadier, more persistent uptrend, more consistent revenue visibility backed by monthly sales disclosures, and a strong balance sheet supporting its expansion plans. While AMAT offers arguably stronger near-term growth momentum and direct leverage to AI-driven equipment spending, its higher volatility and pullback from recent highs introduce greater trend inconsistency. This assessment is probabilistic rather than definitive, and relative positioning could shift as new earnings, guidance, and market conditions emerge.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
To compare these two companies we present long-term analysis, their fundamental ratings and make comparative short-term technical analysis which are presented below. The conclusion is AMAT is a StrongBuy and TSM is a Hold.
AMAT's RSI Oscillator is remaining in oversold zone for 5 days
The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an uptrend is expected.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Stochastic Oscillator shows that the ticker has stayed in the oversold zone for 7 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an upward trend is expected.
Following a +2.45% 3-day Advance, the price is estimated to grow further. Considering data from situations where AMAT advanced for three days, in 251 of 316 cases, the price rose further within the following month. The odds of a continued upward trend are 79%.
AMAT may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on October 13, 2026. You may want to consider selling the stock, shorting the stock, or exploring put options on AMAT as a result. In 66 of 87 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are 76%.
The Moving Average Convergence Divergence Histogram (MACD) for AMAT turned negative on October 13, 2026. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 45 similar instances when the indicator turned negative. In 29 of the 45 cases the stock turned lower in the days that followed. This puts the odds of success at 64%.
AMAT moved below its 50-day moving average on October 13, 2026 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for AMAT crossed bearishly below the 50-day moving average on October 19, 2026. This indicates that the trend has shifted lower and could be considered a sell signal. In 11 of 15 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are 73%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where AMAT declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 66%.
The Aroon Indicator for AMAT entered a downward trend on September 25, 2026. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Fundamental Analysis (Ratings)
The Tickeron PE Growth Rating for this company is 18 (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron SMR rating for this company is 25 (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Price Growth Rating for this company is 57 (best 1 - 100 worst), indicating steady price growth. AMAT’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is 58 (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 76, placing this stock slightly better than average.
The Tickeron Valuation Rating of 75 (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (11.631) is normal, around the industry mean (6.371). P/E Ratio (32.156) is within average values for comparable stocks, (86.229). Projected Growth (PEG Ratio) (0.967) is also within normal values, averaging (0.801). Dividend Yield (0.006) settles around the average of (0.008) among similar stocks. P/S Ratio (10.764) is also within normal values, averaging (27.897).
The Tickeron Seasonality Score of 95 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
Momentum Indicator for TSM turns negative, indicating new downward trend
TSM saw its Momentum Indicator move below the 0 level on October 12, 2026. This is an indication that the stock could be shifting in to a new downward move. Traders may want to consider selling the stock or exploring put options. Tickeron's A.I.dvisor looked at 83 similar instances where the indicator turned negative. In 61 of the 83 cases, the stock moved further down in the following days. The odds of a decline are at 73%.
Technical Analysis (Indicators)
Bearish Trend Analysis
The Moving Average Convergence Divergence Histogram (MACD) for TSM turned negative on October 09, 2026. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 46 similar instances when the indicator turned negative. In 30 of the 46 cases the stock turned lower in the days that followed. This puts the odds of success at 65%.
TSM moved below its 50-day moving average on October 14, 2026 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for TSM crossed bearishly below the 50-day moving average on October 22, 2026. This indicates that the trend has shifted lower and could be considered a sell signal. In 9 of 16 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are 56%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where TSM declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 61%.
TSM broke above its upper Bollinger Band on October 05, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
Bullish Trend Analysis
The RSI Indicator points to a transition from a downward trend to an upward trend -- in cases where TSM's RSI Indicator exited the oversold zone, 17 of 23 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 74%.
The Stochastic Oscillator shows that the ticker has stayed in the oversold zone for 8 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an upward trend is expected.
Following a +2.78% 3-day Advance, the price is estimated to grow further. Considering data from situations where TSM advanced for three days, in 235 of 316 cases, the price rose further within the following month. The odds of a continued upward trend are 74%.
The Aroon Indicator entered an Uptrend today. In 213 of 276 cases where TSM Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 77%.
Fundamental Analysis (Ratings)
The Tickeron Profit vs. Risk Rating rating for this company is 8 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 78, placing this stock better than average.
The Tickeron SMR rating for this company is 26 (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Valuation Rating of 42 (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (0.332) is normal, around the industry mean (6.008). P/E Ratio (0.965) is within average values for comparable stocks, (20.098). Projected Growth (PEG Ratio) (0.859) is also within normal values, averaging (3.761). Dividend Yield (0.009) settles around the average of (0.012) among similar stocks. P/S Ratio (15.480) is also within normal values, averaging (45.794).
The Tickeron Price Growth Rating for this company is 44 (best 1 - 100 worst), indicating steady price growth. TSM’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Seasonality Score of 50 (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron PE Growth Rating for this company is 96 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
AMAT | TSM | ||
|---|---|---|---|
OUTLOOK RATING 1..100 | 67 | 69 | |
VALUATION overvalued / fair valued / undervalued 1..100 | 75 Overvalued | 42 Fair valued | |
PROFIT vs RISK RATING 1..100 | 58 | 8 | |
SMR RATING 1..100 | 25 | 26 | |
PRICE GROWTH RATING 1..100 | 57 | 44 | |
P/E GROWTH RATING 1..100 | 18 | 96 | |
SEASONALITY SCORE 1..100 | 90 | 50 |
Tickeron ratings are formulated such that a rating of 1 designates the most successful stocks in a given industry, while a rating of 100 points to the least successful stocks for that industry.
TSM's Valuation (42) in the Semiconductors industry is somewhat better than the same rating for AMAT (75) in the Electronic Production Equipment industry. This means that TSM’s stock grew somewhat faster than AMAT’s over the last 12 months.
TSM's Profit vs Risk Rating (8) in the Semiconductors industry is somewhat better than the same rating for AMAT (58) in the Electronic Production Equipment industry. This means that TSM’s stock grew somewhat faster than AMAT’s over the last 12 months.
AMAT's SMR Rating (25) in the Electronic Production Equipment industry is in the same range as TSM (26) in the Semiconductors industry. This means that AMAT’s stock grew similarly to TSM’s over the last 12 months.
TSM's Price Growth Rating (44) in the Semiconductors industry is in the same range as AMAT (57) in the Electronic Production Equipment industry. This means that TSM’s stock grew similarly to AMAT’s over the last 12 months.
AMAT's P/E Growth Rating (18) in the Electronic Production Equipment industry is significantly better than the same rating for TSM (96) in the Semiconductors industry. This means that AMAT’s stock grew significantly faster than TSM’s over the last 12 months.
| AMAT | TSM | |
|---|---|---|
| RSI ODDS (%) | 1 day ago 86% | 1 day ago 74% |
| Stochastic ODDS (%) | 1 day ago 78% | 1 day ago 76% |
| Momentum ODDS (%) | 1 day ago 76% | 1 day ago 73% |
| MACD ODDS (%) | 1 day ago 64% | 1 day ago 65% |
| TrendWeek ODDS (%) | 1 day ago 67% | 1 day ago 65% |
| TrendMonth ODDS (%) | 1 day ago 70% | 1 day ago 64% |
| Advances ODDS (%) | 18 days ago 79% | 2 days ago 74% |
| Declines ODDS (%) | 7 days ago 66% | 7 days ago 61% |
| BollingerBands ODDS (%) | 1 day ago 80% | 1 day ago 62% |
| Aroon ODDS (%) | 1 day ago 62% | 1 day ago 77% |
Long-Term Analysis
It is best to consider a long-term outlook for a ticker by using Fundamental Analysis (FA) ratings. The rating of 1 to 100, where 1 is best and 100 is worst, is divided into thirds. The first third (a green rating of 1-33) indicates that the ticker is undervalued; the second third (a grey number between 34 and 66) means that the ticker is valued fairly; and the last third (red number of 67 to 100) reflects that the ticker is overvalued. We use an FA Score to show how many ratings show the ticker to be undervalued (green) or overvalued (red).
AMAT’s FA Score shows that 2 FA rating(s) are green while TSM’s FA Score has 2 green FA rating(s).
- AMAT’s FA Score: 2 green, 3 red.
- TSM’s FA Score: 2 green, 3 red.
Short-Term Analysis
It is best to consider a short-term outlook for a ticker by using Technical Analysis (TA) indicators. We use Odds of Success as the percentage of outcomes which confirm successful trade signals in the past.
If the Odds of Success (the likelihood of the continuation of a trend) for each indicator are greater than 50%, then the generated signal is confirmed. A green percentage from 90% to 51% indicates that the ticker is in a bullish trend. A red percentage from 90% - 51% indicates that the ticker is in a bearish trend. All grey percentages are below 50% and are considered not to confirm the trend signal.
AMAT’s TA Score shows that 4 TA indicator(s) are bullish while TSM’s TA Score has 4 bullish TA indicator(s).
- AMAT’s TA Score: 4 bullish, 6 bearish.
- TSM’s TA Score: 4 bullish, 6 bearish.
Price Growth
AMAT (@Electronic Production Equipment) experienced а -12.66% price change this week, while TSM (@Semiconductors) price change was -2.34% for the same time period.
The average weekly price growth across all stocks in the @Electronic Production Equipment industry was -10.98%. For the same industry, the average monthly price growth was -23.65%, and the average quarterly price growth was -33.54%.
The average weekly price growth across all stocks in the @Semiconductors industry was -8.21%. For the same industry, the average monthly price growth was -19.91%, and the average quarterly price growth was -12.20%.
Reported Earning Dates
AMAT is expected to report earnings on Nov 12, 2026.
TSM is expected to report earnings on Jan 21, 2027.
Industries' Descriptions
@Electronic Production Equipment (-10.98% weekly)The electronic production equipment industry makes equipment used to produce semiconductors. Such equipment includes wafer fabrication, plasma etching and photo-resist processing equipment. The industry also makes chemical vapor deposition processing systems and photomasks, which are high-purity quartz plates that contain patterns to define integrated circuits layouts. Applied Materials, Inc., Lam Research Corporation, and KLA-Tencor Corporation are examples of electronic production equipment manufacturing companies.
@Semiconductors (-8.21% weekly)The semiconductor industry manufacturers all chip-related products, including research and development. These chips are used in innumerable electronic devices, including computers, cell phones, smartphones, and GPSs. Intel Corporation, NVIDIA Corp., and Broadcomm are some of the prominent players in this industry. Semiconductor companies usually tend to do well during periods of healthy economic growth, thereby inducing further research and development in the industry – which in turn augurs well for productivity and growth in the economy. In the near future, demand for semiconductor products (and possibly innovation within the segment) should only expand further, with the proliferation of 5G, autonomous vehicles, IoT, and various AI-driven electronics set to herald a new, advanced chapter in the technology-driven world as we know it. With burgeoning prospects comes great competition. In 2015, SIA estimated that U.S. semiconductor industry ranks as the second most competitive U.S. industry out of 2882 U.S. industries designated manufacturers by the U.S. Census Bureau.
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TSM and
Correlation & Price change
A.I.dvisor indicates that over the last year, TSM has been closely correlated with ASML. These tickers have moved in lockstep 74% of the time. This A.I.-generated data suggests there is a high statistical probability that if TSM jumps, then ASML could also see price increases.
| Ticker / NAME | Correlation To TSM | 1D Price Change % | ||
|---|---|---|---|---|
| TSM | 100% | -4.52% | ||
| ASML - TSM | 74% Closely correlated | -6.93% | ||
| LRCX - TSM | 73% Closely correlated | -11.76% | ||
| KLAC - TSM | 71% Closely correlated | -9.55% | ||
| AMAT - TSM | 71% Closely correlated | -8.16% | ||
| ASX - TSM | 70% Closely correlated | -11.01% | ||
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