On Feb 28, 2014, we issued an updated research report on
MKS Instruments, Inc.
). The company reported strong results for the fourth quarter of
2013. Year over year, adjusted earnings increased a whopping 320%
to 42 cents, while revenues hiked 52.8% to $204.4 million.
The increase in earnings was primarily led by the construction
of a semiconductor fabrication unit in China. MKS Instruments
also recorded 67% year-over-year rise in gross margin for the
fourth quarter. The company has been attempting to enhance
shareholders' values through dividend and share repurchases. The
company currently has a $200 million share repurchase plan in
action, under which shares worth $16 million have already been
bought till 2013.
MKS Instruments is expected to grow through product launches.
These include products launched in the semiconductor
manufacturing related temperature controllers range and medical
equipment and organic light-emitting diode (OLED) display
manufacturing. It is also expected that in the near future,
sapphire will replace the use of glass in mobile displays, which
will in turn lead to the company's growth given its multiple
sapphire production tools.
The rising international sales for the company also pose
certain socio-political, economic and foreign currency
fluctuation risks. The longer time taken to develop a product may
lead to the risk of any other company launching a similar product
earlier. This may lead to additional expenditure for the
Key Picks from the Sector
MKS Instruments currently has a Zacks Rank #3 (Hold). Some
better-ranked stocks worth considering within this sector include
Tessera Technologies Inc.
Ultra Clean Holdings Inc.
). While Tessera Technologies sports a Zacks Rank #1 (Strong
Buy), KLA-Tencor and Ultra Clean Holdings hold a Zacks Rank #2
KLA-TENCOR CORP (KLAC): Free Stock Analysis
MKS INSTRUMENTS (MKSI): Free Stock Analysis
TESSERA TEC INC (TSRA): Free Stock Analysis
ULTRA CLEAN HLD (UCTT): Free Stock Analysis
To read this article on Zacks.com click here.