Applied Materials Process Advantages Build Market Share [August 21, 2013]
One reason I like to have stocks like AMAT in my portfolio, besides the dividend, is that most investors have very short time horizons. If Applied Materials non-GAAP EPS is indeed in the vicinity of $1.50 per share for full fiscal 2016, then it should be around $30 per share then. Almost doubling what it can be bought for today.
Doubling in 3 years is actually great returns. But so many investors are just thinking about what returns they can get within the next quarter, or the next few hours if they are day trading, or the next few nanoseconds if they are computer algorithms, that this long-term value is overlooked. And in many cases, three years from now the investors who pursued what they thought were short-term opportunities will not have doubled their money. A substantial percentage will have halved their money, or worse.
I do have some of my portfolio in high-risk, potentially high gain small cap stocks, but the bulk of it is in Nasdaq 100 stocks or stocks that could potentially join that index.