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Is Entegris (ENTG) A Smart Long-Term Buy?

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Artisan Partners, a high value-added investment management firm, published its ‘Artisan Mid Cap Fund’ third quarter 2021 investor letter – a copy of which can be downloaded here. A return of 3.06% was recorded by its Investor Class: ARTMX, 3.11% by its Advisor Class: APDMX, and 3.12% by its Institutional Class: APHMX, in the third quarter of 2021, all outpacing the Russell Midcap® Growth Index that delivered a -0.76% return, and the Russell Midcap® Index that was down by -0.93% for the same period. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.

Artisan Mid-Cap Fund, in its Q3 2021 investor letter, mentioned Entegris, Inc. (NASDAQ: ENTG) and discussed its stance on the firm. Entegris, Inc. is a Billerica, Massachusetts-based manufacturing company with a $20.8 billion market capitalization. ENTG delivered a 60.26% return since the beginning of the year, while its 12-month returns are up by 72.62%. The stock closed at $154.01 per share on November 19, 2021.

Here is what Artisan Mid-Cap Fund has to say about Entegris, Inc. in its Q3 2021 investor letter:

"Entegris is one of the largest suppliers of advanced materials (high purity gases/chemicals) and filtration systems used in semiconductor manufacturing. The industry’s incredibly complex production environment is getting increasingly onerous—more process steps, greater purity requirements—which is driving higher demand for Entegris’ products and systems. Furthermore, rising chip content across a broad swath of industries (industrial, auto, communications, consumer) to enable new technological advances (5G, AI/ML, cloud, EVs, autonomous vehicles) has driven semiconductor wafer production growth to ~6% annually. The company’s recently reported results were thesis affirming, and we believe the demand drivers for its products are firmly in place. 70% of the company’s revenues are tied to semiconductor factory utilization, and the broader industry shortages do not appear to be abating anytime soon. The other 30% of revenue is tied to capex which we expect to be flat to slightly up over the next couple of years. Given our building confidence around the near-to-medium term demand environment, we added to our position, bringing it to the top of the GardenSM."

Based on our calculations, Entegris, Inc. (NASDAQ: ENTG) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. ENTG was in 25 hedge fund portfolios at the end of the first half of 2021, compared to 23 funds in the previous quarter. Entegris, Inc. (NASDAQ: ENTG) delivered a 36.80% return in the past 3 months.

Disclosure: None. This article is originally published at Insider Monkey.