Technology
A high-quality, defensive, EPS compounder that will out-grow semiconductor volume growth due to trends of increasing purity and material intensity in semis. Furthermore, the benefits from the CMC acquisition could surprise on the upside and are not fully appreciated by the market (the deal represents a step change in establishing a scale advantage over ENTG's competitors). EPS growth will accelerate meaningfully in late 2023 (can compound at ~15% CAGR for the next three years), driven by revenue growth, high incremental margins and cost savings. $5.68 EPS (FY25E) x 20 PE = $114 share price.
Edition: 154
- 17 February, 2023