Applied Materials Seen Outperforming Wafer Fab Equipment Industry, Morgan Stanley Says

Applied Materials (AMAT) is expected to outperform the wafer fab equipment industry by more than 10 percentage points as it benefits from leading-edge logic strength and unprecedented DRAM demand, Morgan Stanley said Friday in a note.

The company noted that the 2027 WFE spending mix should continue to work in its favor, as leading-edge foundry/logic, DRAM, and advanced packaging are expected to account for over 80% of WFE spending growth, according to the firm. However, Morgan Stanley said it remains cautious on the company's position and models its 2027 systems shipments in-line with WFE growth at 28% versus 27%.

Despite management's conviction in its Process Control business, the brokerage is "not yet ready to give the company the benefit of the doubt and will be looking to be proven wrong," according to the note.

The brokerage raised its 2026 EPS and revenue forecast to $13.74 and $36.4 billion from $12.63 and $34.7 billion, respectively. It also lifted 2027 estimates to $17.94 and $45.3 billion from $16.21 and $42.4 billion previously.

Morgan Stanley kept an overweight rating on Applied Materials and raised the price target to $502 from $455.

Price: $433.45, Change: $-7.11, Percent Change: -1.61%

Texas Roadhouse's Traffic Growth 'Durable,' RBC Says

Texas Roadhouse's (TXRH) traffic growth is "durable" and has shown no signs of impact from the conflict in the Middle East, RBC Capital Markets analysts said in a Friday note.Analysts said that the company may benefit from more favorable beef prices, driving an upside to investor margin expectations.RBC said that the company's traffic growth has the potential for further upside, driven by market share gains from retail and steakhouse competitors.The analysts said that their key takeaways from a meeting with Texas Roadhouse were that the company's "solid" labor productivity gains will likely continue, and that the commodity guidance is not "conservative."RBC upgraded the stock's rating to outperform from sector perform, and raised its price target to $210 from $180.Price: $179.43, Change: $+2.37, Percent Change: +1.34%

$TXRH

Palo Alto Networks Seen Advancing Identity Security Platform Strategy, Oppenheimer Says

Palo Alto Networks (PANW) is strengthening its platform strategy through the CyberArk rebrand to Idira and its integration across Strata, Cortex and Prisma, Oppenheimer said in a Friday note.The announcement marks Palo Alto Networks' first public integration of CyberArk's technology and product roadmap into its broader security platform, the firm said.Oppenheimer said its customer survey showed no signs of churn tied to the CyberArk acquisition. Of 22 customers surveyed, 18% expect to increase spending by more than 20% over the next 12 months, 59% expect to increase spending by 5% to 20%, and none expect cuts.Palo Alto is also positioning agentic identity security as a key growth vector, including a Secure AI Agents solution.Oppenheimer reiterated its outperform rating on Palo Alto and raised its price target to $275 from $245.Price: $237.31, Change: $-0.90, Percent Change: -0.38%

$PANW

Update: Market Chatter: Microsoft Explores AI Startup Deals as It Broadens Strategy Beyond OpenAI

(Updates with Microsoft's response in the fifth paragraph.)Microsoft (MSFT) is evaluating potential acquisitions of artificial intelligence startups as the company positions itself for a future less dependent on OpenAI, Reuters reported Wednesday, citing unnamed people familiar with the matter.Among the opportunities considered was code-generation startup Cursor, though Microsoft stepped back over concerns about regulatory scrutiny because of its ownership of GitHub Copilot, the report said.Microsoft is also in talks with Inception, a startup focused on an alternative approach to large language models, according to the report.Microsoft's venture arm, M12, participated in Inception's $50 million seed funding round in late 2025. The discussions remain ongoing and may not lead to a transaction, the report said.Microsoft declined to comment when reached by.(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)Price: $421.80, Change: $+12.37, Percent Change: +3.02%

$MSFT

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