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Entegris (ENTG) Hits a 52-Week High, Can the Run Continue?

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Have you been paying attention to shares of Entegris, Inc. (ENTG - Free Report) ? Shares have been on the move with the stock up 7.7% over the past month. ENTG hit a new 52-week high of $37.13 in the previous session. Entegris has gained 19.1% since the start of the year compared to the 6% move for the Computer and Technology sector and the 14.7% year-to-date return for its peer group.

What's Driving the Outperformance?

The stock has an impressive record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on February 6, 2018, Entegris reported EPS of $0.42  versus the Zacks Consensus Estimate of $0.37 while it beat the consensus revenue estimate by 2.9%.

For the current fiscal year, Entegris is expected to post earnings of $1.75 per share on $1.46 billion in revenues. This represents a 21.53% change in EPS on an 8.86% change in revenues. For the next fiscal year, the company is expected to earn $1.99 per share on $1.56 billion in revenues. This represents changes of 13.53% and 6.45%, respectively.

Valuation Metrics

Entegris may be at a 52-week-high right now, but what might the future hold for ENTG? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.

On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.

Entegris has a Value Score of D. The stock's Growth and Momentum Scores are A and C, respectively, giving the company a VGM Score of B.

In terms of its value breakdown, the stock currently trades at 20.7X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 16.5X versus its peer group's average of 15.8X. Additionally, the stock has a PEG ratio of 1.84. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.

Entegris, Inc. Price and Consensus

 

Entegris, Inc. Price and Consensus | Entegris, Inc. Quote

Zacks Rank

We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Entegris currently has a Zacks Rank #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.

Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 and Style Scores of A or B, it looks as if Entegris meets the list of requirements. Thus, it seems as though ENTG shares could have a bit more room to run in the near term.

How Does EntegrisStack Up to the Competition?

Shares of Entegrishave been moving higher, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also impressive, including KLIC, RTEC, and AEIS, all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.

The Zacks Industry Rank is in the top 46.42% of all the industries we have in our universe, so it looks like there are some nice tailwinds for ENTG, even beyond its own solid fundamental situation.


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