Last Update 05 Mar 26

Fair value Increased 42%

ENTG: AI Materials And Fairly Valued Setup With Mixed Cycle Risks

The analyst price target for Entegris has increased from $100.50 to about $142.73, with analysts citing updated assumptions for revenue growth, profit margins, and future P/E as key factors behind the change.

Analyst Commentary

Recent Street research on Entegris shows a mix of optimism and caution, with several firms adjusting price targets and a few shifting their ratings. For you as an investor, the key themes are how the market views Entegris' ability to execute through the cycle and what that could mean for valuation.

Bullish Takeaways

Bullish analysts have lifted price targets by wide ranges, from single digit moves to increases of $40 or more, which signals higher conviction in the company’s long term earnings power and support for the higher blended target of about $142.73.
Some research points to "optionality for improvement in demand" over the next one to two years, which these analysts appear to be baking into their models through higher revenue and margin assumptions.
Several target hikes close together suggest bullish analysts see recent execution and positioning as strong enough to justify a richer P/E than previously used.
Upgrades from neutral stances to more constructive views indicate that, for these analysts, risk reward has shifted in favor of owning Entegris at current or slightly higher valuation levels.

Bearish Takeaways

Bearish analysts have issued downgrades even as others raise targets, highlighting concern that the stock may already reflect a lot of good news relative to execution risk.
Some research flags ongoing issues such as cyclical downturns in construction and durables demand, which could cap near term earnings progress and limit upside to valuation.
Comments about "structural issues" in chemicals, including commodity capacity overhang and pressure on customers in regions facing deindustrialization, suggest that part of Entegris' end market exposure may face longer term headwinds.
More cautious reports around earnings season and sector wide rating changes imply that, even with higher targets from bullish analysts, there is still debate on how consistently Entegris can translate its positioning into growth and margin expansion.

What's in the News

Entegris issued unaudited guidance for the first quarter ending March 28, 2026, with expected net sales of US$785 million to US$825 million. (Key Developments)
The company guided to GAAP operating income of US$124 million to US$143 million and GAAP net income of US$65 million to US$77 million for the same quarter. (Key Developments)
Diluted earnings per common share for the first quarter of 2026 are expected to be in the range of US$0.43 to US$0.51. (Key Developments)
Entegris announced that Chief Financial Officer Linda LaGorga will step down effective February 28, 2026, and will remain as a Senior Advisor through May 15, 2026, to support the transition. (Key Developments)
Effective March 1, 2026, long time finance executive Mike Sauer, currently VP, Controller and Chief Accounting Officer, will serve as Interim CFO while keeping his existing responsibilities. (Key Developments)

Valuation Changes

Fair Value: The fair value estimate has risen from $100.50 to about $142.73, representing a sizable reset higher in what analysts are using as a central valuation anchor.
Discount Rate: The discount rate has edged down from 11.70% to about 11.40%, a small shift that slightly increases the weight placed on future cash flows.
Revenue Growth: The modeled revenue growth rate has moved from about 6.15% to about 7.01%, indicating analysts now assume a higher annual growth pace in their forecasts.
Net Profit Margin: The assumed net profit margin has adjusted from roughly 12.68% to about 13.43%, signaling a modestly higher profitability hurdle in the new model.
Future P/E: The future P/E multiple used has increased from about 43.9x to about 57.4x, so analysts are now applying a higher valuation multiple to projected earnings.

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Key Takeaways

Localization of manufacturing and supply chains boosts resilience, reduces revenue volatility, and strengthens positioning in key Asian markets.
Advanced materials leadership and operational efficiencies support margin expansion and capture opportunities from rising semiconductor complexity and long-term industry growth trends.
Geopolitical trade risks, cyclical semiconductor demand, operational inefficiencies, high debt, and customer concentration threaten Entegris' revenue stability, profitability, and investment capacity.

Catalysts

About Entegris

Provides advanced materials and process solutions for the semiconductor and other high-technology industries in North America, Taiwan, South Korea, Japan, China, Europe, and Southeast Asia.What are the underlying business or industry changes driving this perspective?

Significant ramping of new manufacturing facilities in Taiwan and Colorado, as well as ongoing regionalization of supply chains, positions Entegris to better serve global customers and mitigate trade policy risks-this should shorten lead times, improve supply chain security, and drive future revenue growth as more production is localized.
Investments and leadership in advanced materials for next-generation nodes, including CMP slurries, selective etch, and deposition materials, position Entegris to capitalize on upcoming node transitions (e.g., advanced logic, 3D NAND, HBM) and increasing semiconductor complexity, supporting higher ASPs and improved gross margins.
Expansion and deepening of regional manufacturing clusters in Asia is enabling customer requalification and quick recovery from trade/tariff disruptions, especially in China, directly reducing volatility in revenues and helping restore growth in these fast-growing markets.
Ongoing cost reduction initiatives and operational efficiencies, alongside higher expected facility utilization in the second half and beyond, are set to enhance free cash flow and expand margins once the current inventory and ramping inefficiencies abate.
Entegris is set to benefit from the long-term acceleration in semiconductor demand driven by proliferating AI, high-performance computing, and increased digitalization and IoT adoption, underpinning robust multi-year revenue and earnings growth potential.

Entegris Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming Entegris's revenue will grow by 6.4% annually over the next 3 years.
Analysts assume that profit margins will increase from 9.2% today to 12.9% in 3 years time.
Analysts expect earnings to reach $502.7 million (and earnings per share of $3.41) by about September 2028, up from $295.5 million today.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 41.6x on those 2028 earnings, down from 41.7x today. This future PE is greater than the current PE for the US Semiconductor industry at 33.5x.
Analysts expect the number of shares outstanding to grow by 0.4% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 11.35%, as per the Simply Wall St company report.

Entegris Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

Persistent uncertainty and volatility around global trade policies-especially US-China tariffs-can disrupt Entegris' revenue streams and operational planning, introduce erratic customer buying patterns, and impair long-term sales visibility and growth, particularly as 70% of revenue is Asia-based and requalification of non-US production remains in transition.
Ongoing industry softness in mainstream logic, DRAM, and NAND, with weak fab utilization (mid-80%) and projected only modestly up at best wafer starts, underscores the continued risk from the cyclical and inventory-driven nature of the semiconductor industry, potentially leading to muted revenue growth and ongoing sales volatility.
Significant operational inefficiencies and margin pressures associated with the ramp and transition of new manufacturing facilities in Taiwan and Colorado, as well as localization efforts, are currently weighing on gross margins and could persist if volume recovery is slow or execution stumbles, directly impacting profitability.
Elevated gross leverage (gross debt ~$4B, 4.3x leverage) inherited from acquisitions constrains financial flexibility and increases interest expenses (~$48M/quarter), risking net margin compression and limiting Entegris' ability to invest aggressively in R&D or weather prolonged downturns.
Customer concentration and the need for ongoing product requalification-especially for strategic customers in China and Asia-create vulnerability to demand fluctuations and require continued heavy investment; any delays, technical failures, or strategic shifts among these large customers could materially impact top-line revenue and earnings stability.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $99.0 for Entegris based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $115.0, and the most bearish reporting a price target of just $85.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $3.9 billion, earnings will come to $502.7 million, and it would be trading on a PE ratio of 41.6x, assuming you use a discount rate of 11.4%.
Given the current share price of $81.22, the analyst price target of $99.0 is 18.0% higher.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

Analysts Raise Entegris Price Target as Earnings Guidance Spurs Modest Valuation Adjustment