S&P MAINTAINS STRONG BUY RECOMMENDATION ON SHARES OF APPLIED MATERIALS
We remain optimistic of business prospects, aided by new product cycles like Windows 8 and healthy orders from foundry and flash memory customers. We also see upside order potential from flat panel display/solar businesses, albeit from depressed levels. We think margins wil see added benefits from higher than expected acquisition cost synergies and lower solar breakeven point. Our FY 12 (Oct.) operating EPS estimate of $0.98 and FY 13's of $1.22 both remain above the Capital IQ consensus forecasts. We keep our 12-month target price at $17, on peer-average P/E and price-to-sales.