A forensic read on Applied Materials Inc /De built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.
B · Sound & dependable
Forensic grade
Safe
Financial health
10.2
Distress distance
Clean
Earnings quality
3
Forensic signals
35.5%
ROE
4.4%
Revenue growth
This free snapshot doesn't read filing or proxy text, so the auditor-quality and governance checks that can lower a grade were not evaluated (auditor quality, say on pay, board independence, going concern). Those checks only ever lower a grade, so the full analysis can land below the grade above but never above it — treat it as the most favourable reading, not the settled one.
Applied Materials Inc /De earns a B (Sound & dependable) forensic quality grade, and its balance-sheet distress test reads 10.2, placing it in the Safe zone. 3 forensic signals were flagged in its latest SEC filings, led by accruals ratio (% of NOA).
What the filings flag
+13.5%
FY2024→FY2025
Accruals ratio (% of NOA).Net operating assets grew +13.5% relative to their own average in FY2025 — scaled by NOA itself, not by total assets, which is what the Forensic Screens card's own accrual row divides by. Accruals are building faster than is comfortable — part of profit is sitting in the balance sheet rather than turning to cash. The build is led by PP&E up +38% against revenue +4% and inventory up +9% against +2% in cost of sales. A cash-flow measure on the same base disagrees: reported earnings ran behind operating cash by 5% of net operating assets, against an accruals ratio of 13.5%. The two are computed differently: the accruals ratio is the change in net operating assets over average net operating assets, while the cash-flow figure is net income less operating cash flow over that same average. Read them as two results, not one.Accruals ratio: the year-over-year change in net operating assets, relative to their own average.NOA (net operating assets): the money tied up in running the business, operating assets minus operating liabilities.
110% of FCF
FY2025
Shareholder returns.Returned $6.3B to shareholders (buybacks + dividends) in FY2025 — 110% of free cash flow, but 79% of operating cash flow. Returns run ahead of free cash flow because the business is also funding heavy growth capex (usually debt-financed); the payout itself is covered by operating cash — sustainable as long as that spending is genuine expansion, not upkeep. Counting the $668M of stock-based comp paid out in shares on top of that, the combined claim on free cash flow is 122%.
$41M
FY2025
Goodwill impairments.Took $41M of goodwill writedowns across 1 year (FY2025 ($41M)) — about 1% of net income over the span. Writedowns mean past acquisitions underperformed what was paid for them.
Key fundamentals
Latest Revenue$28.37B
Revenue Growth YoY+4.4%
Revenue CAGR (2yr)+3.4%
Net Margin24.7%
Free Cash Flow$5.70B
Return on Equity35.5%
Debt / Equity0.32x
The forensic grade and screens above are free — no account needed. Want the AI investment read on top — the 0–100 rating, thesis, bull-vs-bear, red flags and the 12-month scenario, written from Applied Materials Inc /De's actual 10-K/10-Q/8-K filings?