diff --git a/packages/angular/cli/src/commands/add/cli.ts b/packages/angular/cli/src/commands/add/cli.ts
index d65cd78e4278..55768138e4f2 100644
--- a/packages/angular/cli/src/commands/add/cli.ts
+++ b/packages/angular/cli/src/commands/add/cli.ts
@@ -10,7 +10,7 @@ import { analytics, tags } from '@angular-devkit/core';
 import { NodePackageDoesNotSupportSchematics } from '@angular-devkit/schematics/tools';
 import npa from 'npm-package-arg';
 import { dirname, join } from 'path';
-import { compare, intersects, prerelease, satisfies, valid } from 'semver';
+import { Range, compare, intersects, prerelease, satisfies, valid } from 'semver';
 import { Argv } from 'yargs';
 import { PackageManager } from '../../../lib/config/workspace-schema';
 import { isPackageNameSafeForAnalytics } from '../../analytics/analytics';
@@ -47,9 +47,11 @@ interface AddCommandArgs extends SchematicsCommandArgs {
  * when attempting to find a compatible version for a package.
  * The key is a package name and the value is a SemVer range of versions to exclude.
  */
-const packageVersionExclusions: Record<string, string | undefined> = {
-  // @angular/localize@9.x versions do not have peer dependencies setup
-  '@angular/localize': '9.x',
+const packageVersionExclusions: Record<string, string | Range> = {
+  // @angular/localize@9.x and earlier versions as well as @angular/localize@10.0 prereleases do not have peer dependencies setup.
+  '@angular/localize': '<10.0.0',
+  // @angular/material@7.x versions have unbounded peer dependency ranges (>=7.0.0).
+  '@angular/material': '7.x',
 };
 
 export class AddCommandModule
@@ -187,7 +189,10 @@ export class AddCommandModule
               return false;
             }
             // Excluded package versions should not be considered
-            if (versionExclusions && satisfies(value.version, versionExclusions)) {
+            if (
+              versionExclusions &&
+              satisfies(value.version, versionExclusions, { includePrerelease: true })
+            ) {
               return false;
             }
 
diff --git a/tests/legacy-cli/e2e/tests/commands/add/version-specifier.ts b/tests/legacy-cli/e2e/tests/commands/add/version-specifier.ts
index 426f8d5b61e5..5b598ccc9cfb 100644
--- a/tests/legacy-cli/e2e/tests/commands/add/version-specifier.ts
+++ b/tests/legacy-cli/e2e/tests/commands/add/version-specifier.ts
@@ -25,11 +25,6 @@ export default async function () {
     throw new Error('Installation was not skipped');
   }
 
-  const output2 = await ng('add', '@angular/localize@latest', '--skip-confirmation');
-  if (output2.stdout.includes('Skipping installation: Package already installed')) {
-    throw new Error('Installation should not have been skipped');
-  }
-
   // v12.2.0 has a package.json engine field that supports Node.js v16+
   const output3 = await ng('add', '@angular/localize@12.2.0', '--skip-confirmation');
   if (output3.stdout.includes('Skipping installation: Package already installed')) {