Entegris, Inc. has released its 10-K report, and its shares have moved 3.4% on the market, now trading at a price of $135.65. Entegris develops, manufactures, and supplies microcontamination control products, specialty chemicals, and advanced materials handling solutions in various regions, serving a wide range of industries. The company operates in four segments: Specialty Chemicals and Engineered Materials (SCEM), Microcontamination Control (MC), Advanced Planarization Solutions (APS), and Advanced Materials Handling (AMH).
In the annual report, Entegris reported changes in its financial metrics and discussed challenges to its business. The company realigned its segments into three reportable segments: Materials Solutions (MS), Microcontamination Control (MC), and Advanced Materials Handling (AMH). The report also highlighted the impact of new export control regulations and conflicts in the Middle East on the company's operations and financial performance.
Entegris also disclosed recent events, including the termination of a definitive agreement with Infineum, the completion of the divestiture of the QED business, and amendments to its Existing Credit Agreement. The company also terminated an Alliance Agreement with MacDermid Enthone Inc. and completed the divestiture of the Electronic Chemicals business.
For more information, read the company's full 10-K submission here.
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $1,550 | $1,591 | $1,859 | $2,299 | $2,336 | $3,658 |
| Gross Margins | 46% | 45% | 46% | 46% | 60% | 43% |
| Net Margins | 16% | 16% | 16% | 18% | 9% | 5% |
| Net Income (M) | $241 | $255 | $295 | $409 | $209 | $200 |
| Net Interest Expense (M) | $34 | $47 | $49 | $41 | $213 | $329 |
| Depreciation & Amort. (M) | $65 | $75 | $83 | $90 | $135 | $172 |
| Diluted Shares (M) | 143 | 137 | 136 | 137 | 143 | 151 |
| Earnings Per Share | $1.69 | $1.87 | $2.16 | $3.0 | $1.46 | $1.32 |
| EPS Growth | n/a | 10.65% | 15.51% | 38.89% | -51.33% | -9.59% |
| Avg. Price | $31.65 | $39.82 | $64.88 | $118.9 | $116.77 | $135.51 |
| P/E Ratio | 18.51 | 21.07 | 29.63 | 39.37 | 79.44 | 101.13 |
| Free Cash Flow (M) | $202 | $270 | $315 | $190 | -$114 | $35 |
| EV / EBITDA | 16.37 | 21.93 | 21.56 | 27.28 | 43.36 | 35.12 |
| Total Debt (M) | $1,874 | $1,869 | $2,172 | $1,874 | $11,418 | $5,425 |
| Net Debt / EBITDA | 3.89 | 4.83 | 3.32 | 2.29 | 17.64 | 6.77 |
| Current Ratio | 3.82 | 3.53 | 4.08 | 3.47 | 3.06 | 4.31 |
Entegris, Inc. appears to be undervalued at a price of $135.65 per share due to its strong revenue growth and competitive margins within the plastics industry. However, the company's declining earnings per share and high PEG ratio suggest that the market may be overvaluing its growth potential.
On the positive side, Entegris's revenues are growing rapidly at a rate of 18.4%, and its capital expenditures are increasing at a rate of 33.7%. The company also maintains favorable operating and gross margins compared to its industry peers. Conversely, its declining earnings per share and high PEG ratio indicate potential concerns about its future growth prospects.
In terms of value, Entegris has a highly leveraged balance sheet, as indicated by its Net Debt/EBITDA ratio of 6.77 and its historical average. While the firm's free cash flows have shown variability, its expected earnings per share indicate a lower forward P/E ratio. However, the current P/E ratio is higher than the industry average, suggesting that the stock may be trading at a premium.
Please note that this analysis is not personalized financial advice and should be considered as general information for investment purposes.
