We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
MKS Instruments (MKSI) Q1 Earnings Beat, Revenues Up Y/Y
Read MoreHide Full Article
MKS Instruments (MKSI - Free Report) reported first-quarter 2022 adjusted earnings of $2.71 per share, which beat the Zacks Consensus Estimate by 4.63% and improved 6% year over year.
Revenues of $742 million missed the consensus mark by 1.06% and increased 7% year over year. Global supply chain challenges and lower industry demand for certain products resulted in a decline in revenues.
Products revenues (87.3% of total revenues) were $648 million, up 7.1% year over year. Services revenues (12.7% of total revenues) increased 5.6% year over year to $94 million.
Quarterly Update
Revenues from the semiconductor market (65.8% of total revenues) advanced 19% year over year to $488 million.
Revenues from advanced electronics market (11.1% of total revenues) were $82 million, down 29% year over year. The downside was due to low demand for flexible PCB via drilling equipment in the industry.
Revenues from the speciality industrial market (23.2% of total revenues) increased 2% year over year to $172 million.
MKS Instruments, Inc. Price, Consensus and EPS Surprise
In the first quarter, adjusted EBITDA increased 6% year over year to $211 million. Adjusted EBITDA margin decreased by 20 bps on a year-over-year basis to 28.4%.
Research & development, as a percentage of revenues, increased by 20 bps year over year. Meanwhile, sales, general & administrative expenses, as a percentage of revenues, declined 140 bps on a year-over-year basis.
MKS Instruments reported non-GAAP operating income of $190 million, up 6.1% year over year. Adjusted operating margin decreased by 20 bps on a year-over-year basis to 25.6%. Rising input cost is one the primary factors responsible for decrease in operating margin.
Balance Sheet
As of Mar 31, 2022, MKS Instruments had cash and short-term investments of $1.1 billion compared with $910 million as of Mar 31, 2021.
As of Mar 31, 2021 secured term loan principal outstanding was $822 million. The company had $100 million of incremental borrowing capacity under an asset-based line of credit, subject to certain borrowing base requirements.
Cash flow from operations was $41 million in the first quarter compared with the fourth quarter 2021’s figure of $194 million. Free cash flow was $22 million compared with $171 million reported in the previous quarter.
MKS Instruments paid out dividends worth $12 million during the reported quarter.
Q2 Guidance
For the second quarter of 2022, MKS Instruments anticipates revenues to be $730 million (+/- $30 million). The Zacks Consensus Estimate for revenues is currently pegged at $749.95 million, indicating growth of 8.08% from the year-ago quarter.
Non-GAAP earnings are expected to be $2.28 per share (+/- 24 cents).
The consensus mark for earnings is currently pegged at $2.59 per share, suggesting an improvement of 1.17% from the prior-year quarter.
Zacks Rank & Stocks to Consider
Currently, MKS Instruments carries a Zacks Rank #3 (Hold).
MKS Instruments shares have underperformed the Zacks Computer & Technology sector in the year-to-date period. While MKSI shares have fallen 33.2%, the sector has declined 23.1%. Here are some better stocks to consider in the broader sector.
Image: Bigstock
MKS Instruments (MKSI) Q1 Earnings Beat, Revenues Up Y/Y
MKS Instruments (MKSI - Free Report) reported first-quarter 2022 adjusted earnings of $2.71 per share, which beat the Zacks Consensus Estimate by 4.63% and improved 6% year over year.
Revenues of $742 million missed the consensus mark by 1.06% and increased 7% year over year. Global supply chain challenges and lower industry demand for certain products resulted in a decline in revenues.
Products revenues (87.3% of total revenues) were $648 million, up 7.1% year over year. Services revenues (12.7% of total revenues) increased 5.6% year over year to $94 million.
Quarterly Update
Revenues from the semiconductor market (65.8% of total revenues) advanced 19% year over year to $488 million.
Revenues from advanced electronics market (11.1% of total revenues) were $82 million, down 29% year over year. The downside was due to low demand for flexible PCB via drilling equipment in the industry.
Revenues from the speciality industrial market (23.2% of total revenues) increased 2% year over year to $172 million.
MKS Instruments, Inc. Price, Consensus and EPS Surprise
MKS Instruments, Inc. price-consensus-eps-surprise-chart | MKS Instruments, Inc. Quote
Operating Details
In the first quarter, adjusted EBITDA increased 6% year over year to $211 million. Adjusted EBITDA margin decreased by 20 bps on a year-over-year basis to 28.4%.
Research & development, as a percentage of revenues, increased by 20 bps year over year. Meanwhile, sales, general & administrative expenses, as a percentage of revenues, declined 140 bps on a year-over-year basis.
MKS Instruments reported non-GAAP operating income of $190 million, up 6.1% year over year. Adjusted operating margin decreased by 20 bps on a year-over-year basis to 25.6%. Rising input cost is one the primary factors responsible for decrease in operating margin.
Balance Sheet
As of Mar 31, 2022, MKS Instruments had cash and short-term investments of $1.1 billion compared with $910 million as of Mar 31, 2021.
As of Mar 31, 2021 secured term loan principal outstanding was $822 million. The company had $100 million of incremental borrowing capacity under an asset-based line of credit, subject to certain borrowing base requirements.
Cash flow from operations was $41 million in the first quarter compared with the fourth quarter 2021’s figure of $194 million. Free cash flow was $22 million compared with $171 million reported in the previous quarter.
MKS Instruments paid out dividends worth $12 million during the reported quarter.
Q2 Guidance
For the second quarter of 2022, MKS Instruments anticipates revenues to be $730 million (+/- $30 million). The Zacks Consensus Estimate for revenues is currently pegged at $749.95 million, indicating growth of 8.08% from the year-ago quarter.
Non-GAAP earnings are expected to be $2.28 per share (+/- 24 cents).
The consensus mark for earnings is currently pegged at $2.59 per share, suggesting an improvement of 1.17% from the prior-year quarter.
Zacks Rank & Stocks to Consider
Currently, MKS Instruments carries a Zacks Rank #3 (Hold).
MKS Instruments shares have underperformed the Zacks Computer & Technology sector in the year-to-date period. While MKSI shares have fallen 33.2%, the sector has declined 23.1%. Here are some better stocks to consider in the broader sector.
Analog Devices (ADI - Free Report) carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
ADI shares have fallen 13.1% in the year-to-date period. ADI is expected to report second quarter 2022 earnings on May 18.
Cisco Systems (CSCO - Free Report) carries a Zacks Rank of 2.
Cisco shares have fallen 19.6% in the year-to-date period. Cisco is expected to report third quarter 2022 earnings on May 18.
BWX Technologies (BWXT - Free Report) carries a Zacks Rank of 2.
BWX shares have returned 9.2% in the year-to-date period. BWX is expected to report first quarter 2022 earnings on May 9.