Entegris, Inc. reports 38.7% EBITDA growth in 2020 and 16.9% Revenue growth
02/02/2021 • About Entegris, Inc. (
$ENTG) • By InTwits
Entegris, Inc. reported 2020 financial results today. Here are the key drivers of the company's long term financial model:
- Entegris, Inc. is a growth stock: 2020 revenue growth was 16.9%, 5 year revenue CAGR was 11.5% at 2020 ROIC 16.4%
- Entegris, Inc. has medium CAPEX intensity: 5 year average CAPEX/Revenue was 6.8%. At the same time it's in pair with industry average of 7.6%
- CAPEX is quite volatile: $15m in FY2020, $47m in FY2019, $45m in FY2018, $70m in FY2017, $187m in FY2016
- The company has highly profitable business model: ROIC is 16.4%
- It operates with medium-size leverage: Net Debt/EBITDA is 1.0x while industry average is -1.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue jumped on 16.9%. Revenue growth showed acceleration in 20Q4 - it increased 21.2% YoY. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 5.1 pp from -0.073% to 5.0% in FY2020.
Gross Margin increased slightly on 0.97 pp from 44.7% to 45.7% in 2020. SG&A as a % of Revenue decreased on 3.6 pp from 17.9% to 14.3% in 2020.
Net Income margin showed almost no change in 2020.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 7.1% in 2020. Entegris, Inc.'s CAPEX/Revenue showed almost no change from 2017 to 2020. It's average level of CAPEX/Revenue for the last three years was 7.1%.
Return on investment
The company operates at high and attractive ROE (23.2%) while ROIC is a bit lower (16.4%). ROIC increased on 5.1 pp from 11.3% to 16.4% in 2020. ROE showed almost no change in 2020.
Leverage (Debt)
Debt level is 1.0x Net Debt / EBITDA and 2.1x Debt / EBITDA. Net Debt / EBITDA dropped on 0.6x from 1.6x to 1.0x in 2020. Debt surged on 14.7% while cash jumped on 65.1%.
Entegris, Inc. has no short term refinancing risk: cash is higher than short term debt (5,832.3%).
Valuation and dividends
The company's trades at EV/EBITDA 24.6x and P/E 43.7x.
Management team
Entegris, Inc.'s CEO Bertrand Loy has spent 8 years with the company. Entegris, Inc.'s CFO is Gregory B Graves. Gregory B Graves has 13 years tenure at the company.
Financial and operational results
FY ended 12/31/2020
Entegris, Inc. ($ENTG) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 1,175 | 1,343 | 1,550 | 1,591 | 1,859 | 16.9% |
| Gross Profit | 509 | 609 | 720 | 712 | 850 | 19.4% |
| SG&A | 202 | 216 | 247 | 285 | 265 | -6.9% |
| EBITDA | 255 | 344 | 420 | 393 | 546 | 38.7% |
| EBIT | 156 | 242 | 293 | | | |
| Interest expence | 37 | 32 | 34 | | | |
| Tax | 23 | 100 | 14 | | | |
| Net Income | 97 | 85 | 241 | 255 | 295 | 15.7% |
| Stock Based Compensation | 13 | 15 | 17 | | | |
Balance Sheet
|
|---|
| Cash | 406 | 625 | 482 | 352 | 581 | 65.1% |
| Accounts Receivable | 166 | 183 | 222 | | | |
| Inventory | 184 | 198 | 268 | | | |
| Accounts Payable | 62 | 69 | 93 | | | |
| Short Term Debt | 100 | 100 | 4 | 14 | 10 | -29.0% |
| Long Term Debt | 485 | 574 | 935 | 976 | 1,126 | 15.3% |
Cash flow
|
|---|
| Capex | 65 | 94 | 110 | 112 | 132 | 17.3% |
| Dividends | | 10 | 40 | | | |
| Acquisitions | | 20 | 381 | | | |
Ratios
|
|---|
| Revenue growth | 8.7% | 14.2% | 15.5% | 2.6% | 16.9% | |
| EBITDA growth | 16.2% | 34.7% | 22.1% | -6.4% | 38.7% | |
|
|---|
| Gross Margin | 43.3% | 45.4% | 46.4% | 44.7% | 45.7% | 1.0% |
| EBITDA Margin | 21.7% | 25.6% | 27.1% | 24.7% | 29.3% | 4.6% |
| EBIT Margin | 13.2% | 18.0% | 18.9% | | |
| SG&A, % of revenue | 17.2% | 16.1% | 15.9% | 17.9% | 14.3% | -3.6% |
| SBC, % of revenue | 1.1% | 1.1% | 1.1% | | |
| Net Income Margin | 8.3% | 6.3% | 15.5% | 16.0% | 15.9% | -0.2% |
| CAPEX, % of revenue | 5.6% | 7.0% | 7.1% | 7.1% | 7.1% | 0.0% |
|
|---|
| ROIC | 10.3% | 14.7% | 15.4% | 11.3% | 16.4% | 5.1% |
| ROE | 11.4% | 9.0% | 24.0% | 23.4% | 23.2% | -0.2% |
| Net Debt/EBITDA | 0.7x | 0.1x | 1.1x | 1.6x | 1.0x | -0.6x |
| Interest coverage ratio (ICR) | 4.2x | 7.5x | 8.6x | | |
| Interest expence / Average debt | 6.3% | 5.1% | 4.2% | | | |
People
|
|---|
| Insider ownership | 1.2% | 1.2% | 1.2% | | | |
| Employees | 3,542 | 3,900 | 4,900 | | | |
| Revenue/Employee, th. $ | 332 | 344 | 316 | | | |
Entegris, Inc. ($ENTG) key quoterly financial indicators
| mln. $ | 20Q1 | 20Q2 | 20Q3 | 20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 412 | 448 | 481 | 518 | | 5.4% | 18.4% | 22.0% | 21.2% |
| EBITDA | 121 | 132 | 143 | 150 | | 41.0% | 41.8% | 57.5% | 21.1% |
| Net Income | 61 | 68 | 79 | 87 | | 86.8% | -45.1% | 94.5% | 50.8% |
Balance Sheet
|
|---|
| Cash | 335 | 533 | 448 | 581 | | -2.1% | 2.2% | 58.4% | 65.1% |
| Short Term Debt | 14 | 10 | 10 | 10 | | 12.8% | -22.8% | -22.3% | -29.0% |
| Long Term Debt | 1,118 | 1,226 | 1,126 | 1,126 | | 14.7% | 25.8% | 15.1% | 15.3% |
Ratios
|
|---|
| Gross Margin | 45.0% | 46.2% | 47.0% | 44.6% | | -0.4% | 2.4% | 3.8% | -1.7% |
| EBITDA Margin | 29.4% | 29.4% | 29.7% | 29.0% | | 7.4% | 4.8% | 6.7% | -0.0% |
| Net Income Margin | 14.8% | 15.2% | 16.5% | 16.7% | | 6.4% | -17.6% | 6.1% | 3.3% |
Peers in Semiconductor Equipment
Below you can find Entegris, Inc. benchmarking vs. other companies in Semiconductor Equipment industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Xperi Corporation ($XPER) | - | 44.0% | 8.7% | -31.0% | 218.5% |
| DAQO New Energy Corp. ($DQ) | - | 41.1% | -6.7% | 16.0% | 93.0% |
| Advanced Energy Industries, Inc. ($AEIS) | - | 38.7% | 7.1% | 9.7% | 79.5% |
| Ichor Holdings ($ICHR) | - | 61.7% | 25.6% | -24.6% | 47.3% |
| ACM Research, Inc. ($ACMR) | - | 33.4% | 104.5% | 44.1% | 45.7% |
| |
|---|
| Median (27 companies) | 5.0% | 24.7% | 14.0% | -2.8% | 16.3% |
|---|
| Entegris, Inc. ($ENTG) | - | 14.2% | 15.5% | 2.6% | 16.9% |
Top companies by Gross margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Xperi Corporation ($XPER) | 99.8% | 98.3% | 96.7% | 97.0% | 91.2% |
| PDF Solutions, Inc. ($PDFS) | 58.6% | 53.4% | 50.1% | 60.9% | 58.2% |
| Teradyne, Inc. ($TER) | 54.7% | 57.2% | 58.1% | 58.4% | 57.2% |
| Nova Measuring Instruments Ltd. ($NVMI) | 45.9% | 59.1% | 57.8% | 54.2% | 56.8% |
| Kulicke and Soffa Industries, Inc. ($KLIC) | 45.7% | 47.2% | 46.1% | 47.1% | 47.8% |
| |
|---|
| Median (27 companies) | 37.3% | 43.2% | 40.2% | 40.3% | 42.4% |
|---|
| Entegris, Inc. ($ENTG) | 43.3% | 45.4% | 46.4% | 44.7% | 45.7% |
Top companies by EBITDA margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Xperi Corporation ($XPER) | 47.6% | 23.4% | 34.3% | 16.4% | 40.8% |
| DAQO New Energy Corp. ($DQ) | 43.3% | 49.1% | 36.1% | 27.1% | 38.0% |
| Teradyne, Inc. ($TER) | 3.4% | 29.6% | 27.9% | 30.3% | 33.8% |
| Cabot Microelectronics Corporation ($CCMP) | 23.4% | 27.2% | 31.5% | 20.1% | 31.6% |
| Nova Measuring Instruments Ltd. ($NVMI) | 10.2% | 28.8% | 27.1% | 22.1% | 25.9% |
| |
|---|
| Median (25 companies) | 11.4% | 16.0% | 16.2% | 11.9% | 15.4% |
|---|
| Entegris, Inc. ($ENTG) | 21.7% | 25.6% | 27.1% | 24.7% | 29.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| DAQO New Energy Corp. ($DQ) | 29.5% | 19.8% | 47.4% | 79.7% | 17.5% |
| Photronics, Inc. ($PLAB) | 10.4% | 20.4% | 17.3% | 32.4% | 11.6% |
| Cabot Microelectronics Corporation ($CCMP) | 4.1% | 4.2% | 3.6% | 5.4% | 11.3% |
| Amkor Technology, Inc. ($AMKR) | 16.5% | 13.1% | 12.7% | 11.7% | 10.9% |
| ACM Research, Inc. ($ACMR) | 2.9% | 1.8% | 2.5% | 0.9% | 9.5% |
| |
|---|
| Median (24 companies) | 2.2% | 2.8% | 2.9% | 3.2% | 3.3% |
|---|
| Entegris, Inc. ($ENTG) | 5.6% | 7.0% | 7.1% | 7.1% | 7.1% |
Top companies by ROIC, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Teradyne, Inc. ($TER) | -2.9% | 23.8% | 22.6% | 29.2% | 40.3% |
| DAQO New Energy Corp. ($DQ) | 12.7% | 23.2% | 12.2% | 5.6% | 18.5% |
| Advanced Energy Industries, Inc. ($AEIS) | 41.2% | 45.7% | 31.3% | 6.9% | 15.5% |
| Ultra Clean Holdings, Inc. ($UCTT) | 7.8% | 27.5% | 10.5% | 4.1% | 14.8% |
| MKS Instruments, Inc. ($MKSI) | 10.1% | 20.3% | 22.7% | 8.3% | 14.1% |
| |
|---|
| Median (27 companies) | 6.9% | 12.2% | 11.2% | 5.5% | 10.2% |
|---|
| Entegris, Inc. ($ENTG) | 10.3% | 14.7% | 15.4% | 11.3% | 16.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Veeco Instruments Inc. ($VECO) | - | - | - | 577.2x | 3.4x |
| Cohu, Inc. ($COHU) | -6.0x | -2.7x | - | 10.1x | 2.9x |
| Xperi Corporation ($XPER) | 4.2x | 5.0x | 2.6x | 6.1x | 2.1x |
| Cabot Microelectronics Corporation ($CCMP) | -1.3x | -1.8x | -1.9x | 3.6x | 2.0x |
| MKS Instruments, Inc. ($MKSI) | 1.7x | 0.1x | -0.5x | 1.5x | 0.8x |
| |
|---|
| Median (23 companies) | -1.3x | -0.7x | -1.0x | -0.4x | -0.4x |
|---|
| Entegris, Inc. ($ENTG) | 0.7x | 0.1x | 1.1x | 1.6x | 1.0x |
