On Aug 6, 2013, we initiated our coverage of
MKS Instruments, Inc.
) with a Neutral recommendation. Mass.-based MKS Instruments
provides instruments, subsystems and process control solutions,
required to measure, control, power, monitor and analyze
parameters that help in improving process performance and
MKS Instruments reported sequentially-improved results for the
second quarter of 2013, with earnings per share of 14 cents.
Revenues also improved 13.7% sequentially to $132.5 million
backed by improvement in the semiconductor industry. However, the
results declined year over year.
MKS Instruments' main clients include semiconductor equipment
manufacturers. For 2012, sales to semiconductor capital equipment
manufacturers and semiconductor device manufacturers accounted
for roughly 62% of the net sales. The semiconductor industry is
on the rise, giving the company the scope to expand.
The company has launched products in the semiconductor
manufacturing related temperature controllers range as well as
medical equipment and organic light-emitting diode (OLED) display
manufacturing. These products are expected to drive the company's
However, MKS Instruments feels the brunt of its customers'
locations. Most of the semiconductor equipment manufacturers are
based out of the U.S. making the company susceptible to various
geo-political as well as foreign currency risks.
As is common with hi-tech products, MKS Instruments' products
also take a relatively longer period of time to develop. However,
in the meantime, the company's competitors might launch a similar
product or the technology might be replaced by a newer one. This
will result in the company incurring losses on its
Other Stocks to Consider
MKS Instruments currently carries a Zacks Rank #4 (Sell).
Other stocks worth a watch in the industry are
Axcelis Technologies Inc.
), each carrying a Zacks Rank #2 (Buy).
AXCELIS TECH (ACLS): Free Stock Analysis
COHU INC (COHU): Free Stock Analysis Report
EMCORE CORP (EMKR): Free Stock Analysis
MKS INSTRUMENTS (MKSI): Free Stock Analysis
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