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At US$64.15, Is MKS Instruments, Inc. (NASDAQ:MKSI) Worth Looking At Closely?

Wade Goff

MKS Instruments, Inc. (NASDAQ:MKSI), which is in the semiconductor business, and is based in United States, saw a double-digit share price rise of over 10% in the past couple of months on the NasdaqGS. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Let’s examine MKS Instruments’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

Check out our latest analysis for MKS Instruments

What’s the opportunity in MKS Instruments?

Great news for investors – MKS Instruments is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is $105.51, but it is currently trading at US$64.15 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, MKS Instruments’s share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.

What does the future of MKS Instruments look like?

NasdaqGS:MKSI Future Profit January 1st 19

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company’s future expectations. MKS Instruments’s earnings over the next few years are expected to increase by 38%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? Since MKSI is currently undervalued, it may be a great time to increase your holdings in the stock. With a positive outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on MKSI for a while, now might be the time to make a leap. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy MKSI. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on MKS Instruments. You can find everything you need to know about MKS Instruments in the latest infographic research report. If you are no longer interested in MKS Instruments, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.