Entegris (NASDAQ:ENTG) and Allegro MicroSystems (NASDAQ:ALGM) Financial Analysis

Entegris (NASDAQ:ENTG) and Allegro MicroSystems (NASDAQ:ALGM) are both technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, risk, dividends, institutional ownership and profitability.

Analyst Ratings

This is a summary of current ratings and price targets for Entegris and Allegro MicroSystems, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Entegris	0	2	11	2	3.00
Allegro MicroSystems	1	1	10	1	2.85

Entegris currently has a consensus price target of $181.67, suggesting a potential upside of 35.05%. Allegro MicroSystems has a consensus price target of $51.58, suggesting a potential upside of 63.86%. Given Allegro MicroSystems’ higher probable upside, analysts plainly believe Allegro MicroSystems is more favorable than Entegris.

Institutional and Insider Ownership

56.5% of Allegro MicroSystems shares are held by institutional investors. 0.5% of Entegris shares are held by company insiders. Comparatively, 0.5% of Allegro MicroSystems shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Entegris and Allegro MicroSystems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Entegris	9.18%	12.25%	5.84%
Allegro MicroSystems	1.50%	8.30%	5.65%

Volatility and Risk

Entegris has a beta of 1.4, indicating that its stock price is 40% more volatile than the S&P 500. Comparatively, Allegro MicroSystems has a beta of 1.99, indicating that its stock price is 99% more volatile than the S&P 500.

Valuation & Earnings

This table compares Entegris and Allegro MicroSystems”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Entegris	$3.20 billion	6.42	$235.60 million	$1.99	67.60
Allegro MicroSystems	$890.10 million	6.59	-$14.90 million	$0.06	524.67

Entegris has higher revenue and earnings than Allegro MicroSystems. Entegris is trading at a lower price-to-earnings ratio than Allegro MicroSystems, indicating that it is currently the more affordable of the two stocks.

Summary

Entegris beats Allegro MicroSystems on 10 of the 15 factors compared between the two stocks.

About Entegris

Entegris, Inc. develops, manufactures, and supplies microcontamination control products, specialty chemicals, and advanced materials handling solutions in North America, Taiwan, China, South Korea, Japan, Europe, and Southeast Asia. It operates in three segments: Materials Solutions (MS); Microcontamination Control (MC); and Advanced Materials Handling (AMH). The MC segment solutions to purify critical liquid chemistries and process gases used in semiconductor manufacturing processes and other high-technology industries; integrated circuit chemical mechanical polishing solutions, high-performance etch and clean chemistries, gases and materials, and safe and materials delivery systems. The MS segment provides materials-based solutions, such as chemical mechanical planarization slurries, pads, deposition materials, process chemistries and gases, formulated cleans, etchants, and other specialty materials. The Advanced Materials Handling segment develops solutions for customers' yields by protecting critical materials during manufacturing, transportation, and storage, which include monitor, protect, transport and deliver critical liquid chemistries, wafers, and other substrates for semiconductor, life sciences and other high-technology industries. The company's customers include logic and memory semiconductor device manufacturers, semiconductor equipment makers, gas and chemical manufacturing companies, and wafer grower companies; and flat panel display equipment makers, panel manufacturers, and manufacturers of hard disk drive components and devices, as well as their related ecosystems. It serves manufacturers and suppliers in the solar and life science industries, electrical discharge machining customers, glass and glass container manufacturers, aerospace manufacturers, and manufacturers of biomedical implantation devices. Entegris, Inc. was founded in 1966 and is headquartered in Billerica, Massachusetts.

About Allegro MicroSystems

Allegro MicroSystems, Inc., together with its subsidiaries, designs, develops, manufactures, and markets sensor integrated circuits (ICs) and application-specific analog power ICs for motion control and energy-efficient systems. Its products include magnetic sensor ICs, such as position, speed, and current sensor ICs; and power ICs comprising motor driver ICs, regulator and LED driver ICs, and isolated gate drivers. The company sells its products to original equipment manufacturers and distributors primarily in the automotive and industrial markets through its direct sales force, third party distributors, independent sales representatives, and consignment. It operates in the United States, rest of the Americas, Europe, Japan, Greater China, South Korea, and other Asian markets. The company was founded in 1990 and is headquartered in Manchester, New Hampshire. Allegro MicroSystems, Inc. is a subsidiary of Sanken Electric Co., Ltd.