Entegris is a chemicals and filtration company that just happens to sell into the semiconductor market. We want to be owners of ENTG as it is high-quality, defensive, and an EPS compounder that will out-grow semi volume growth due to trends of increasing purity and material intensity in semis.
We think the benefits from the CMC acquisition could surprise on the upside and is not fully appreciated by the market.
Financials are poised to improve: EPS growth will accelerate meaningfully in late 2023 driven by revenue growth, high incremental margins, cost saves, and continue into 2025 as debt is paid down.
Potential Upside: $114 (+31%) Sensible Downside: $70 (-20%)
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