ENTG - Entegris: Green Shoots On Paper Not Yet In The Results

2024-02-16 07:26:11 ET

Summary

• Entegris has faced challenges due to its high debt incurred from a deal made at the peak of the cycle.
• The company divested some activities to address leverage and is well-positioned to benefit from long-term growth trends in the long haul.
• While there are signs of improvement, the company's valuation is demanding and the extent of future growth is uncertain.

The investment thesis for Entegris (ENTG) has been dominated by the purchase of CMC Materials at the top of the past cycle, adding lots of leverage at the wrong point in time. With the debt overhang causing pressure on the shares early in 2023, I believed that some signs of life were seen in spring of last year....

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