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MKSI vs. ENTG: Which Stock Is the Better Value Option?

Zacks Equity Research
Updated
Steel Dynamics (STLD) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues.

Investors with an interest in Electronics - Manufacturing Machinery stocks have likely encountered both MKS Instruments (MKSI) and Entegris (ENTG). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Right now, both MKS Instruments and Entegris are sporting a Zacks Rank of # 2 (Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. But this is only part of the picture for value investors.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.

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Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

MKSI currently has a forward P/E ratio of 12.61, while ENTG has a forward P/E of 19.73. We also note that MKSI has a PEG ratio of 1.26. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. ENTG currently has a PEG ratio of 1.75.

Another notable valuation metric for MKSI is its P/B ratio of 3.34. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, ENTG has a P/B of 5.01.

These are just a few of the metrics contributing to MKSI's Value grade of B and ENTG's Value grade of D.

Both MKSI and ENTG are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that MKSI is the superior value option right now.


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MKS Instruments, Inc. (MKSI) : Free Stock Analysis Report
 
Entegris, Inc. (ENTG) : Free Stock Analysis Report
 
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