Comprehensive Stock Comparison
Compare Applied Materials, Inc. (AMAT) vs Broadcom Inc. (AVGO) Stock
Analyze side-by-side fundamentals, valuation, growth, and profitability to decide which stock is the better buy.
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Quick Verdict
| Category | Winner | Why |
|---|---|---|
| Growth | AVGO | 23.9% revenue growth vs AMAT's 4.4% |
| Value | AMAT | PEG 1.97 vs 2.23 |
| Quality / Margins | AVGO | 36.2% net margin vs AMAT's 24.7% |
| Stability / Safety | AMAT | Beta 1.66 vs AVGO's 1.75, lower leverage |
| Dividends | AVGO | 0.7% yield, 15-year raise streak, vs AMAT's 0.5% |
| Momentum (1Y) | AMAT | +136.7% vs AVGO's +61.4% |
| Efficiency (ROA) | AMAT | 19.3% ROA vs AVGO's 13.5%, ROIC 33.3% vs 14.9% |
Who Each Stock Is For
Income & stability
Growth exposure
Long-term compounding (10Y)
Sleep-well-at-night portfolio
Valuation efficiency (growth/$)
Defensive / Recession hedge
Business Model
What each company does and how it makes money
Applied Materials is the world's leading supplier of semiconductor manufacturing equipment and services. It generates about 70% of revenue from selling semiconductor fabrication systems — with the remaining 30% from services and display equipment — through its three main segments: Semiconductor Systems, Applied Global Services, and Display. Its competitive moat stems from its comprehensive portfolio across the entire chipmaking process and deep customer relationships with major foundries like TSMC, Intel, and Samsung.
Broadcom is a semiconductor and infrastructure software company that designs and supplies critical components for data centers, networking, and connectivity. It generates revenue primarily from semiconductor sales (~70%) and infrastructure software licensing (~30%), with key segments including wired infrastructure, wireless communications, and enterprise storage. The company's moat lies in its deep engineering expertise, extensive patent portfolio, and entrenched positions in mission-critical infrastructure where customers face high switching costs.
Revenue Breakdown by Segment
How each company's revenue is distributed across its business units
Financial Metrics Comparison
Side-by-side fundamentals across 2 stocks. BestLagging
Financial Scorecard
AVGO leads in 3 of 6 categories (Financial Metrics, Total Returns). AMAT leads in 3 (Valuation Metrics, Profitability & Efficiency).
Financial Metrics (TTM)
AVGO is the larger business by revenue, generating $63.9B annually — 2.3x AMAT's $28.4B. AVGO is the more profitable business, keeping 36.2% of every revenue dollar as net income compared to AMAT's 24.7%. On growth, AVGO holds the edge at +22.0% YoY revenue growth, suggesting stronger near-term business momentum.
| Metric | AMATApplied Materials… | AVGOBroadcom Inc. |
|---|---|---|
| RevenueTrailing 12 months | $28.4B | $63.9B |
| EBITDAEarnings before interest/tax | $8.4B | $34.2B |
| Net IncomeAfter-tax profit | $7.0B | $23.1B |
| Free Cash FlowCash after capex | $5.7B | $26.9B |
| Gross MarginGross profit ÷ Revenue | +48.7% | +67.8% |
| Operating MarginEBIT ÷ Revenue | +29.2% | +39.9% |
| Net MarginNet income ÷ Revenue | +24.7% | +36.2% |
| FCF MarginFCF ÷ Revenue | +20.1% | +42.1% |
| Rev. Growth (YoY)Latest quarter vs prior year | -3.5% | +22.0% |
| EPS Growth (YoY)Latest quarter vs prior year | +13.9% | +3.1% |
Valuation Metrics
At 43.0x trailing earnings, AMAT trades at a 36% valuation discount to AVGO's 67.0x P/E. Adjusting for growth (PEG ratio), AMAT offers better value at 2.50x vs AVGO's 4.80x — a lower PEG means you pay less per unit of expected earnings growth.
| Metric | AMATApplied Materials… | AVGOBroadcom Inc. |
|---|---|---|
| Market CapShares × price | $295.2B | $1.52T |
| Enterprise ValueMkt cap + debt − cash | $294.5B | $1.56T |
| Trailing P/EPrice ÷ TTM EPS | 42.99x | 66.99x |
| Forward P/EPrice ÷ next-FY EPS est. | 33.87x | 31.10x |
| PEG RatioP/E ÷ EPS growth rate | 2.50x | 4.80x |
| EV / EBITDAEnterprise value multiple | 35.07x | 44.06x |
| Price / SalesMarket cap ÷ Revenue | 10.41x | 23.71x |
| Price / BookPrice ÷ Book value/share | 14.74x | 19.08x |
| Price / FCFMarket cap ÷ FCF | 51.81x | 56.29x |
Profitability & Efficiency
AMAT delivers a 34.3% return on equity — every $100 of shareholder capital generates $34 in annual profit, vs $28 for AVGO. AMAT carries lower financial leverage with a 0.32x debt-to-equity ratio, signaling a more conservative balance sheet compared to AVGO's 0.80x. On the Piotroski fundamental quality scale (0–9), AMAT scores 7/9 vs AVGO's 4/9, reflecting strong financial health.
| Metric | AMATApplied Materials… | AVGOBroadcom Inc. |
|---|---|---|
| ROE (TTM)Return on equity | +34.3% | +28.4% |
| ROA (TTM)Return on assets | +19.3% | +13.5% |
| ROICReturn on invested capital | +33.3% | +14.9% |
| ROCEReturn on capital employed | +30.6% | +16.9% |
| Piotroski ScoreFundamental quality 0–9 | 7 | 4 |
| Debt / EquityFinancial leverage | 0.32x | 0.80x |
| Net DebtTotal debt minus cash | -$686M | $49.0B |
| Cash & Equiv.Liquid assets | $7.2B | $16.2B |
| Total DebtShort + long-term debt | $6.6B | $65.1B |
| Interest CoverageEBIT ÷ Interest expense | 35.46x | 8.09x |
Total Returns (with DRIP)
A $10,000 investment in AVGO five years ago would be worth $67,244 today (with dividends reinvested), compared to $31,004 for AMAT. Over the past 12 months, AMAT leads with a +136.7% total return vs AVGO's +61.4%. The 3-year compound annual growth rate (CAGR) favors AVGO at 76.4% vs AMAT's 48.1% — a key indicator of consistent wealth creation.
| Metric | AMATApplied Materials… | AVGOBroadcom Inc. |
|---|---|---|
| YTD ReturnYear-to-date | +38.6% | -8.1% |
| 1-Year ReturnPast 12 months | +136.7% | +61.4% |
| 3-Year ReturnCumulative with dividends | +224.6% | +448.6% |
| 5-Year ReturnCumulative with dividends | +210.0% | +572.4% |
| 10-Year ReturnCumulative with dividends | +1926.2% | +2389.2% |
| CAGR (3Y)Annualised 3-year return | +48.1% | +76.4% |
Risk & Volatility
AMAT is the less volatile stock with a 1.66 beta — it tends to amplify market swings less than AVGO's 1.75 beta. A beta below 1.0 means the stock typically moves less than the S&P 500. AMAT currently trades 94.0% from its 52-week high vs AVGO's 77.1% drawdown — a narrower gap to the peak suggests stronger recent price momentum.
| Metric | AMATApplied Materials… | AVGOBroadcom Inc. |
|---|---|---|
| Beta (5Y)Sensitivity to S&P 500 | 1.66x | 1.75x |
| 52-Week HighHighest price in past year | $395.95 | $414.61 |
| 52-Week LowLowest price in past year | $123.74 | $138.10 |
| % of 52W HighCurrent price vs 52-week peak | +94.0% | +77.1% |
| RSI (14)Momentum oscillator 0–100 | 63.2 | 44.2 |
| Avg Volume (50D)Average daily shares traded | 6.3M | 21.0M |
Analyst Outlook
Wall Street rates AMAT as "Buy" and AVGO as "Buy". Consensus price targets imply 38.9% upside for AVGO (target: $444) vs 13.0% for AMAT (target: $421). For income investors, AVGO offers the higher dividend yield at 0.72% vs AMAT's 0.46%.
| Metric | AMATApplied Materials… | AVGOBroadcom Inc. |
|---|---|---|
| Analyst RatingConsensus buy/hold/sell | Buy | Buy |
| Price TargetConsensus 12-month target | $420.83 | $443.72 |
| # AnalystsCovering analysts | 53 | 57 |
| Dividend YieldAnnual dividend ÷ price | +0.5% | +0.7% |
| Dividend StreakConsecutive years of raises | 8 | 15 |
| Dividend / ShareAnnual DPS | $1.71 | $2.30 |
| Buyback YieldShare repurchases ÷ mkt cap | +1.7% | +0.4% |
Historical Charts
Charts are rendered on first load. Hover for details.
Chart 1Total Return — 5 Years (Rebased to 100)
| Stock | Mar 20 | Feb 26 | Change |
|---|---|---|---|
| Applied Materials, … (AMAT) | 100 | 545.88 | +445.9% |
| Broadcom Inc. (AVGO) | 100 | 1,161.79 | +1061.8% |
Broadcom Inc. (AVGO) returned +572% over 5 years vs Applied Materials, … (AMAT)'s +210%. A $10,000 investment in AVGO 5 years ago would be worth $67,244 today (including dividends reinvested).
Chart 2Revenue Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Applied Materials, … (AMAT) | $10.8B | $28.4B | +162.1% |
| Broadcom Inc. (AVGO) | $13.2B | $63.9B | +382.5% |
Applied Materials, Inc.'s revenue grew from $10.8B (2016) to $28.4B (2025) — a 11.3% CAGR. Broadcom Inc.'s revenue grew from $13.2B (2016) to $63.9B (2025) — a 19.1% CAGR.
Chart 3Net Margin Trend — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Applied Materials, … (AMAT) | 15.9% | 24.7% | +55.2% |
| Broadcom Inc. (AVGO) | -13.1% | 36.2% | +375.6% |
Applied Materials, Inc.'s net margin went from 16% (2016) to 25% (2025). Broadcom Inc.'s net margin went from -13% (2016) to 36% (2025).
Chart 4P/E Ratio History — 9 Years
| Stock | 2017 | 2025 | Change |
|---|---|---|---|
| Applied Materials, … (AMAT) | 16.1 | 29.7 | +84.5% |
| Broadcom Inc. (AVGO) | 61.2 | 72.6 | +18.6% |
Applied Materials, Inc. has traded in a 11x–30x P/E range over 9 years; current trailing P/E is ~43x. Broadcom Inc. has traded in a 9x–189x P/E range over 9 years; current trailing P/E is ~67x.
Chart 5EPS Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Applied Materials, … (AMAT) | 1.54 | 8.66 | +462.3% |
| Broadcom Inc. (AVGO) | -0.44 | 4.77 | +1184.1% |
Applied Materials, Inc.'s EPS grew from $1.54 (2016) to $8.66 (2025) — a 21% CAGR. Broadcom Inc.'s EPS grew from $-0.44 (2016) to $4.77 (2025).
Chart 6Free Cash Flow — 5 Years
Applied Materials, Inc. generated $6B FCF in 2025 (+19% vs 2021). Broadcom Inc. generated $27B FCF in 2025 (+102% vs 2021).
AMAT vs AVGO: Frequently Asked Questions
9 questions · data-driven answers · updated daily
01Is AMAT or AVGO a better buy right now?
Applied Materials, Inc. (AMAT) offers the better valuation at 43.0x trailing P/E (33.9x forward), making it the more compelling value choice. Analysts rate Applied Materials, Inc. (AMAT) a "Buy" — based on 53 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.
02Which has the better valuation — AMAT or AVGO?
On trailing P/E, Applied Materials, Inc. (AMAT) is the cheapest at 43.0x versus Broadcom Inc. at 67.0x. On forward P/E, Broadcom Inc. is actually cheaper at 31.1x — notably different from the trailing picture, reflecting expected earnings growth. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: Applied Materials, Inc. wins at 1.97x versus Broadcom Inc.'s 2.23x — a reasonable growth-adjusted valuation.
03Which is the better long-term investment — AMAT or AVGO?
Over the past 5 years, Broadcom Inc. (AVGO) delivered a total return of +572.4%, compared to +210.0% for Applied Materials, Inc. (AMAT). A $10,000 investment in AVGO five years ago would be worth approximately $67K today (assuming dividends reinvested). Over 10 years, the gap is even starker: AVGO returned +23.9% versus AMAT's +1926%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.
04Which is safer — AMAT or AVGO?
By beta (market sensitivity over 5 years), Applied Materials, Inc. (AMAT) is the lower-risk stock at 1.66β versus Broadcom Inc.'s 1.75β — meaning AVGO is approximately 6% more volatile than AMAT relative to the S&P 500. On balance sheet safety, Applied Materials, Inc. (AMAT) carries a lower debt/equity ratio of 32% versus 80% for Broadcom Inc. — giving it more financial flexibility in a downturn.
05Which has better profit margins — AMAT or AVGO?
Broadcom Inc. (AVGO) is the more profitable company, earning 36.2% net margin versus 24.7% for Applied Materials, Inc. — meaning it keeps 36.2% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: AVGO leads at 39.9% versus 29.2% for AMAT. At the gross margin level — before operating expenses — AVGO leads at 67.8%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.
06Is AMAT or AVGO more undervalued right now?
The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential. By this metric, Applied Materials, Inc. (AMAT) is the more undervalued stock at a PEG of 1.97x versus Broadcom Inc.'s 2.23x. Both stocks trade at elevated growth-adjusted valuations, so expected growth needs to materialise. On forward earnings alone, Broadcom Inc. (AVGO) trades at 31.1x forward P/E versus 33.9x for Applied Materials, Inc. — 2.8x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for AVGO: 38.9% to $443.72.
07Which pays a better dividend — AMAT or AVGO?
All stocks in this comparison pay dividends. Broadcom Inc. (AVGO) offers the highest yield at 0.7%, versus 0.5% for Applied Materials, Inc. (AMAT).
08Is AMAT or AVGO better for a retirement portfolio?
For long-horizon retirement investors, Applied Materials, Inc. (AMAT) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (+1926% 10Y return). Broadcom Inc. (AVGO) carries a higher beta of 1.75 — meaning larger drawdowns in market downturns, which matters significantly when you cannot wait years for a recovery. Both have compounded well over 10 years (AMAT: +1926%, AVGO: +23.9%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.
09What are the main differences between AMAT and AVGO?
Both stocks operate in the Technology sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both. AVGO pays a dividend while AMAT does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.
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