Entegris (NASDAQ:ENTG) and Applied Materials (NASDAQ:AMAT) are both large-cap computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, risk, dividends, institutional ownership, profitability, valuation and analyst recommendations.
Profitability
This table compares Entegris and Applied Materials' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
Entegris | 15.03% | 26.54% | 12.06% |
Applied Materials | 21.04% | 40.65% | 18.07% |
Institutional and Insider Ownership
98.4% of Entegris shares are held by institutional investors. Comparatively, 78.8% of Applied Materials shares are held by institutional investors. 1.7% of Entegris shares are held by insiders. Comparatively, 0.4% of Applied Materials shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Earnings and Valuation
This table compares Entegris and Applied Materials' gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
Entegris | $1.59 billion | 8.83 | $254.86 million | $1.93 | 53.92 |
Applied Materials | $17.20 billion | 6.27 | $3.62 billion | $4.17 | 28.18 |
Applied Materials has higher revenue and earnings than Entegris. Applied Materials is trading at a lower price-to-earnings ratio than Entegris, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of recent ratings and price targets for Entegris and Applied Materials, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
Entegris | 0 | 2 | 5 | 0 | 2.71 |
Applied Materials | 0 | 4 | 18 | 0 | 2.82 |
Entegris currently has a consensus price target of $100.7778, indicating a potential downside of 3.14%. Applied Materials has a consensus price target of $125.7391, indicating a potential upside of 7.05%. Given Applied Materials' stronger consensus rating and higher probable upside, analysts plainly believe Applied Materials is more favorable than Entegris.
Dividends
Entegris pays an annual dividend of $0.32 per share and has a dividend yield of 0.3%. Applied Materials pays an annual dividend of $0.88 per share and has a dividend yield of 0.7%. Entegris pays out 16.6% of its earnings in the form of a dividend. Applied Materials pays out 21.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Entegris has increased its dividend for 1 consecutive years and Applied Materials has increased its dividend for 3 consecutive years. Applied Materials is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Risk & Volatility
Entegris has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500. Comparatively, Applied Materials has a beta of 1.48, indicating that its share price is 48% more volatile than the S&P 500.
Summary
Applied Materials beats Entegris on 12 of the 17 factors compared between the two stocks.