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MKSI Instruments Well Poised on Solid Semiconductor Trade

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On Sep 2, 2016, we issued an updated research report on premium technology company MKS Instruments, Inc. (MKSI - Free Report) . The company offers instruments, subsystems and process-control solutions to measure, control, power, monitor and analyze parameters of manufacturing processes, and enjoys a robust position in the industry.
    
Bullish Factors     

Tailwinds in the semiconductor and other advanced markets have been boosting MKS Instruments’ revenues and margins. The company’s latest acquisition of Newport Corporation is also expected to support revenue growth. The company has acquired Newport Corporation to provide superior integrated solutions for lithography modules & systems and inspection in the near term. Also, in order to strengthen its overall operational efficacy, MKS Instruments has established a new Combined Targeted Operating Model. The model aims to enhance the company’s profitability by making it more technologically competent in niche markets. This new model has helped the company establish a sound capital deployment scheme to solidify its balance sheet, increase aggregate liquidity and augment shareholders’ cash returns. By the end of 2016, MKS Instrument aims to generate revenues of $1.4 billion and adjusted earnings in the range of $2.97–$2.35 per share, by executing the strategies established under its new operating model.

Investors’ Concerns

We believe that this Zacks Rank #1 (Strong Buy) stock would continue to witness improvement in its top line and bottom line in the quarters ahead. However, certain issues such as market share loss due to stiff competition and unfavorable currency fluctuation might depress revenues and margins in the near term.

Other Stocks to Consider

MKS Instruments currently sports a Zacks Rank #1 (Strong Buy). Other well-ranked stocks in the industry include Entegris, Inc. (ENTG - Free Report) , Aixtron SE and Intevac Inc. (IVAC - Free Report) . While Entegris has a Zacks Rank similar to that of MKS Instruments, both Aixtron and Intevac currently hold a Zacks Rank #2 (Buy), .

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