NasdaqGS:MKSI

Stock Analysis Report

Executive Summary

MKS Instruments, Inc. provides instruments, subsystems, and process control solutions that measure, monitor, deliver, analyze, power, and control critical parameters of manufacturing processes worldwide.

Rewards

PE ratio (36.3x) is below the Semiconductor industry average (37.4x)

Earnings are forecast to grow 38.38% per year

Risk Analysis

Has a high level of debt

Profit margins (9.1%) are lower than last year (18.8%)



Snowflake Analysis

Reasonable growth potential with adequate balance sheet.


Similar Companies

Share Price & News

How has MKS Instruments's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: MKSI has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-1.6%

MKSI

2.1%

US Semiconductor

-1.3%

US Market


1 Year Return

42.1%

MKSI

46.6%

US Semiconductor

22.0%

US Market

Return vs Industry: MKSI underperformed the US Semiconductor industry which returned 46.9% over the past year.

Return vs Market: MKSI exceeded the US Market which returned 24.7% over the past year.


Shareholder returns

MKSIIndustryMarket
7 Day-1.6%2.1%-1.3%
30 Day1.3%5.0%1.8%
90 Day1.9%17.2%9.3%
1 Year43.5%42.1%49.5%46.6%24.6%22.0%
3 Year74.4%69.8%93.4%82.9%49.2%39.6%
5 Year243.0%222.5%173.9%147.8%77.9%58.3%

Price Volatility Vs. Market

How volatile is MKS Instruments's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is MKS Instruments undervalued compared to its fair value and its price relative to the market?

36.34x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: MKSI ($113.89) is trading above our estimate of fair value ($101.3)

Significantly Below Fair Value: MKSI is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: MKSI is good value based on its PE Ratio (36.3x) compared to the Semiconductor industry average (37.4x).

PE vs Market: MKSI is poor value based on its PE Ratio (36.7x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: MKSI is good value based on its PEG Ratio (1x)


Price to Book Ratio

PB vs Industry: MKSI is good value based on its PB Ratio (3.2x) compared to the US Semiconductor industry average (3.2x).


Next Steps

Future Growth

How is MKS Instruments forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

38.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: MKSI's forecast earnings growth (38.4% per year) is above the savings rate (1.7%).

Earnings vs Market: MKSI's earnings (38.4% per year) are forecast to grow faster than the US market (14.3% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: MKSI's revenue (10.6% per year) is forecast to grow faster than the US market (7.5% per year).

High Growth Revenue: MKSI's revenue (10.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: MKSI's Return on Equity is forecast to be low in 3 years time (10.5%).


Next Steps

Past Performance

How has MKS Instruments performed over the past 5 years?

25.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: MKSI has high quality earnings.

Growing Profit Margin: MKSI's current net profit margins (9.1%) are lower than last year (18.8%).


Past Earnings Growth Analysis

Earnings Trend: MKSI's earnings have grown significantly by 25.4% per year over the past 5 years.

Accelerating Growth: MKSI's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: MKSI had negative earnings growth (-57.6%) over the past year, making it difficult to compare to the Semiconductor industry average (-15.8%).


Return on Equity

High ROE: MKSI's Return on Equity (8.6%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is MKS Instruments's financial position?


Financial Position Analysis

Short Term Liabilities: MKSI's short term assets ($1.4B) exceed its short term liabilities ($310.7M).

Long Term Liabilities: MKSI's short term assets ($1.4B) exceed its long term liabilities ($1.1B).


Debt to Equity History and Analysis

Debt Level: MKSI's debt to equity ratio (45.2%) is considered high.

Reducing Debt: Insufficient data to determine if MKSI's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: MKSI's debt is well covered by operating cash flow (33.9%).

Interest Coverage: MKSI's interest payments on its debt are well covered by EBIT (9x coverage).


Balance Sheet

Inventory Level: MKSI has a high level of physical assets or inventory.

Debt Coverage by Assets: MKSI's debt is covered by short term assets (assets are 1.5x debt).


Next Steps

Dividend

What is MKS Instruments's current dividend yield, its reliability and sustainability?

0.71%

Current Dividend Yield


Dividend Yield vs Market

company0.7%marketbottom25%1.4%markettop25%3.7%industryaverage1.9%forecastin3Years0.7%

Current dividend yield vs market & industry

Notable Dividend: MKSI's dividend (0.7%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: MKSI's dividend (0.7%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

Stable Dividend: MKSI is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: MKSI is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: MKSI is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of MKSI's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of MKS Instruments's salary, the management and board of directors tenure and is there insider trading?

1.0yrs

Average management tenure


CEO

John T. Lee (56yo)

0yrs

Tenure

US$2,658,929

Compensation

Dr. John T. C. Lee has been the President of MKS Instruments, Inc. since May 2018 and Chief Executive Officer and Director since January 1, 2020. Dr. Lee served as the Chief Operating Officer at MKS Instru ...


CEO Compensation Analysis

Compensation vs Market: John T.'s total compensation ($USD2.66M) is below average for companies of similar size in the US market ($USD6.46M).

Compensation vs Earnings: John T.'s compensation has been consistent with company performance over the past year.


Management Age and Tenure

1.0yrs

Average Tenure

57yo

Average Age

Experienced Management: MKSI's management team is not considered experienced ( 1 years average tenure), which suggests a new team.


Board Age and Tenure

4.8yrs

Average Tenure

61yo

Average Age

Experienced Board: MKSI's board of directors are considered experienced (4.8 years average tenure).


Insider Trading

Insider Buying: MKSI insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$1,147,99331 Oct 19
Kathleen Burke
EntityIndividual
Role
Chief Legal Officer
Senior VP
Shares10,384
Max PriceUS$110.55
SellUS$2,017,44030 Oct 19
Seth Bagshaw
EntityIndividual
Role
Chief Financial Officer
Senior VP
Shares18,000
Max PriceUS$112.08
SellUS$555,15029 Oct 19
Gerald Colella
EntityIndividual
Role
Member of the Board of Directors
Director
Shares5,000
Max PriceUS$111.03
SellUS$49,43405 Aug 19
Jacqueline Moloney
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares603
Max PriceUS$81.98
SellUS$379,08812 Jun 19
Gerald Colella
EntityIndividual
Role
Member of the Board of Directors
Director
Shares5,000
Max PriceUS$75.82
SellUS$21,98009 May 19
Jacqueline Moloney
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares256
Max PriceUS$85.86
SellUS$128,95609 May 19
Richard Chute
EntityIndividual
Shares1,499
Max PriceUS$86.03

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Seth Bagshaw (59yo)

    Senior VP

    • Tenure: 10yrs
    • Compensation: US$2.43m
  • Jim Schreiner (57yo)

    Senior VP & COO

    • Tenure: 0.3yrs
  • Kathleen Burke

    Senior VP

    • John T. Lee (56yo)

      President

      • Compensation: US$2.66m
    • Maryann Naddy

      Senior Director of Corporate Marketing

      • David Ryzhik

        Vice President of Investor Relations

        • Tenure: 0.3yrs
      • Jennifer Reilly

        Senior VP & Chief Human Resources Officer

        • Tenure: 1yrs
      • Francis Tan

        Senior Vice President of Strategic Development

        • Tenure: 1yrs
      • Dave Henry

        Senior Vice President of Marketing & Project Management


        Board Members

        • John Bertucci (78yo)

          Non-Executive Chairman

          • Tenure: 24.2yrs
          • Compensation: US$341.10k
        • Greg Beecher (61yo)

          Lead Director

          • Tenure: 8yrs
          • Compensation: US$292.25k
        • Michelle Warner (52yo)

          Director

          • Tenure: 0.7yrs
        • Jerry Colella (62yo)

          Director

          • Tenure: 6yrs
          • Compensation: US$10.26m
        • Rick Hess (66yo)

          Independent Director

          • Tenure: 2.7yrs
          • Compensation: US$245.50k
        • Elizabeth Mora (58yo)

          Independent Director

          • Tenure: 7.7yrs
          • Compensation: US$270.00k
        • John T. Lee (56yo)

          President

          • Compensation: US$2.66m
        • Raj Batra (51yo)

          Independent Director

          • Tenure: 1.3yrs
          • Compensation: US$189.50k
        • Jacqueline Moloney (65yo)

          Independent Director

          • Tenure: 3.6yrs
          • Compensation: US$255.50k

        Company Information

        MKS Instruments, Inc.'s company bio, employee growth, exchange listings and data sources


        Key Information

        • Name: MKS Instruments, Inc.
        • Ticker: MKSI
        • Exchange: NasdaqGS
        • Founded: 1961
        • Industry: Semiconductor Equipment
        • Sector: Semiconductors
        • Market Cap: US$6.367b
        • Shares outstanding: 54.51m
        • Website: https://www.mksinst.com

        Number of Employees


        Location

        • MKS Instruments, Inc.
        • 2 Tech Drive
        • Suite 201
        • Andover
        • Massachusetts
        • 1810
        • United States

        Listings

        TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
        MKSINasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDMar 1999
        MKTDB (Deutsche Boerse AG)YesCommon StockDEEURMar 1999
        0JWGLSE (London Stock Exchange)YesCommon StockGBUSDMar 1999
        MKTBRSE (Berne Stock Exchange)YesCommon StockCHCHFMar 1999
        MKSI *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNMar 1999

        Biography

        MKS Instruments, Inc. provides instruments, subsystems, and process control solutions that measure, monitor, deliver, analyze, power, and control critical parameters of manufacturing processes worldwide. It operates through two segments, Vacuum and Analysis, and Light and Motion. The Vacuum and Analysis segment offers analytical and control solutions, including gas analyzers, automation control products, I/O modules, automation software, and precision machined components and electromechanical assemblies; direct and indirect pressure measurement and integrated process solutions; and materials delivery solutions comprising flow and valve technologies, as well as integrated pressure measurement and control subsystems to provide customers with control capabilities that are optimized for a given application. It also provides delivery, plasma, and reactive gas generation products used in semiconductor and other thin film applications, and medical imaging equipment applications. The Light and Motion segment offers lasers and laser-based systems, such as amplifiers, fiber lasers, diode-pumped solid-state lasers, high-energy pulsed lasers, and tunable lasers, as well as accessories; optics products comprising precision optics, thin-film filters and coatings, replicated mirrors, and ruled and holographic diffraction gratings; and photonics products comprising optical components, lens assemblies, and vibration isolation solutions, as well as three-dimensional non-contact measurement sensors and equipment. It also designs, develops, and manufactures subsystems and subassemblies. The company markets and sells its products and services through its direct sales organization, an international network of independent distributors, and sales representatives, as well as through its Websites and product catalogs. MKS Instruments, Inc. was founded in 1961 and is headquartered in Andover, Massachusetts. 


        Company Analysis and Financial Data Status

        All financial data provided by Standard & Poor's Capital IQ.
        DataLast Updated (UTC time)
        Company Analysis2020/01/24 23:54
        End of Day Share Price2020/01/24 00:00
        Earnings2019/09/30
        Annual Earnings2018/12/31


        Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.