 Shares of maker of machinery employed in semiconductor manufacturing, applied materials, NASDAQ, AMAT, fell 6.4 percent in the aftermarket session, after Reuters reported that the company is under US criminal investigation for allegedly evading export restrictions on China's leading chipmaker, SMIC, Semiconductor Manufacturing International Corporation. The report noted that the Justice Department is probing claims that AMAT sent equipment to SMIC via South Korea without proper licenses. The investigation centers on shipments made after SMIC's inclusion in the entity list in December 2020 amid US restrictions on chip exports to China for national security. While AMAT is cooperating and no charges have been confirmed, the uncertainty likely led to the share drop reflecting investor concerns about potential impacts on the company's operations and reputation. Separately, applied materials reported third-quarter earnings that blew past analysts' EPS expectations. Revenue outperformed Wall Street's estimates, driven by strong results in all three of its reportable segments, semiconductor systems, applied global services, and display and adjacent markets. Looking ahead, the company provided revenue and EPS guidance for next quarter that beat analysts' estimates, especially during a time when many semiconductor companies are providing cautionary outlooks. Overall, we think this was a strong quarter that should satisfy shareholders. The stock market overreacts to news and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy applied materials? Applied materials' shares are quite volatile and over the last year have had eight moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.