Semiconductor Manufacturing Stocks Q2 Recap: Benchmarking Entegris (NASDAQ:ENTG)

The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how semiconductor manufacturing stocks fared in Q2, starting with Entegris (NASDAQ:ENTG).

The semiconductor industry is driven by demand for advanced electronic products like smartphones, PCs, servers, and data storage. The need for technologies like artificial intelligence, 5G networks, and smart cars is also creating the next wave of growth for the industry. Keeping up with this dynamism requires new tools that can design, fabricate, and test chips at ever smaller sizes and more complex architectures, creating a dire need for semiconductor capital manufacturing equipment.

The 14 semiconductor manufacturing stocks we track reported a solid Q2. As a group, revenues beat analysts’ consensus estimates by 1.9% while next quarter’s revenue guidance was 2.7% below.

Stocks--especially those trading at higher multiples--had a strong end of 2023, but this year has seen periods of volatility. Mixed signals about inflation have led to uncertainty around rate cuts, and semiconductor manufacturing stocks have had a rough stretch. On average, share prices are down 6.5% since the latest earnings results.

Entegris (NASDAQ:ENTG)

With fabs representing the company’s largest customer type, Entegris (NASDAQ:ENTG) supplies products that purify, protect, and generally ensure the integrity of raw materials needed for advanced semiconductor manufacturing.

Entegris reported revenues of $812.7 million, down 9.8% year on year. This print exceeded analysts’ expectations by 1.3%. Despite the top-line beat, it was still a mixed quarter for the company with a significant improvement in its gross margin but underwhelming revenue guidance for the next quarter.

Bertrand Loy, Entegris’ president and chief executive officer, said: “The Entegris team delivered another quarter of strong performance and execution. Sales (excluding divestitures) increased 10 percent sequentially and were up in all three divisions and in most product lines.”

Unsurprisingly, the stock is down 9.9% since reporting and currently trades at $110.16.

Read our full report on Entegris here, it’s free.

Best Q2: Nova (NASDAQ:NVMI)

Headquartered in Israel, Nova (NASDAQ:NVMI) is a provider of quality control systems used in semiconductor manufacturing.

Nova reported revenues of $156.9 million, up 27.8% year on year, outperforming analysts’ expectations by 5.9%. It was an exceptional quarter for the company with an impressive beat of analysts’ EPS estimates and a significant improvement in its operating margin.

Nova pulled off the fastest revenue growth among its peers. The market seems happy with the results as the stock is up 10.2% since reporting. It currently trades at $199.83.

Is now the time to buy Nova? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: IPG Photonics (NASDAQ:IPGP)

Both a designer and manufacturer of its products, IPG Photonics (NASDAQ:IPGP) is a provider of high-performance fiber lasers used for cutting, welding, and processing raw materials.

IPG Photonics reported revenues of $257.6 million, down 24.2% year on year, in line with analysts’ expectations. It was a weak quarter for the company with underwhelming revenue guidance for the next quarter.

IPG Photonics posted the slowest revenue growth in the group. As expected, the stock is down 25.8% since the results and currently trades at $65.

Read our full analysis of IPG Photonics’s results here.

Teradyne (NASDAQ:TER)

Sporting most major chip manufacturers as its customers, Teradyne (NASDAQ:TER) is a US-based supplier of automated test equipment for semiconductors as well as other technologies and devices.

Teradyne reported revenues of $729.9 million, up 6.6% year on year, surpassing analysts’ expectations by 4.1%. Revenue aside, it was a solid quarter for the company with a significant improvement in its inventory levels and an impressive beat of analysts’ EPS estimates.

The stock is down 12% since reporting and currently trades at $126.06.

Read our full, actionable report on Teradyne here, it’s free.

Semtech (NASDAQ:SMTC)

A public company since the late 1960s, Semtech (NASDAQ:SMTC) is a provider of analog and mixed-signal semiconductors used for Internet of Things systems and cloud connectivity.

Semtech reported revenues of $215.4 million, down 9.7% year on year, surpassing analysts’ expectations by 1.5%. More broadly, it was a strong quarter for the company with an impressive beat of analysts’ EPS estimates and a significant improvement in its gross margin.

The stock is up 10.5% since reporting and currently trades at $42.17.

Read our full, actionable report on Semtech here, it’s free.

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