Entegris (NASDAQ: ENTG) and Fortive (NYSE:FTV) are both mid-cap computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, profitability, institutional ownership, earnings, dividends, risk and analyst recommendations.

Profitability

This table compares Entegris and Fortive’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Entegris 10.73% 18.82% 10.52%
Fortive 14.39% 31.67% 11.32%

Dividends

Entegris pays an annual dividend of $0.07 per share and has a dividend yield of 0.2%. Fortive pays an annual dividend of $0.28 per share and has a dividend yield of 0.4%. Entegris pays out 7.2% of its earnings in the form of a dividend. Fortive pays out 10.6% 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.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Entegris and Fortive, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Entegris 0 3 7 1 2.82
Fortive 0 7 6 0 2.46

Entegris currently has a consensus price target of $32.30, indicating a potential upside of 0.16%. Fortive has a consensus price target of $70.40, indicating a potential downside of 5.19%. Given Entegris’ stronger consensus rating and higher probable upside, analysts plainly believe Entegris is more favorable than Fortive.

Earnings and Valuation

This table compares Entegris and Fortive’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Entegris $1.18 billion 3.88 $97.14 million $0.97 33.25
Fortive $6.22 billion 4.15 $872.30 million $2.65 28.02

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

Insider and Institutional Ownership

96.2% of Entegris shares are owned by institutional investors. Comparatively, 78.7% of Fortive shares are owned by institutional investors. 1.5% of Entegris shares are owned by company insiders. Comparatively, 12.1% of Fortive shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Risk & Volatility

Entegris has a beta of 1.52, meaning that its stock price is 52% more volatile than the S&P 500. Comparatively, Fortive has a beta of 0.44, meaning that its stock price is 56% less volatile than the S&P 500.

Summary

Fortive beats Entegris on 9 of the 17 factors compared between the two stocks.

About Entegris

Entegris, Inc. is a global developer, manufacturer and supplier of microcontamination control products, specialty chemicals and materials handling solutions for manufacturing processes in the semiconductor and other high-technology industries. The Company operates in three business segments: Specialty Chemicals and Engineered Materials (SCEM), Advanced Materials Handling (AMH) and Microcontamination Control (MC). The SCEM segment provides process chemistries, gases, materials and delivery systems to support semiconductor and other manufacturing processes. The AMH segment develops solutions to monitor, protect, transport, and deliver critical liquid chemistries and substrates for a set of applications in the semiconductor industry and other high-technology industries. AMH offers wafer solutions, chemical containers and fluidics. MC offers solutions to purify critical liquid chemistries and gases used in semiconductor manufacturing processes and other high-technology industries.

About Fortive

Fortive Corporation is a diversified industrial growth company. The Company designs, develops, manufactures and markets professional and engineered products, software and services for a range of end markets. The Company operates through two segments: Professional Instrumentation and Industrial Technologies. The Company’s brands operate in field instrumentation, transportation, sensing, product realization, automation and specialty, and franchise distribution markets. The Professional Instrumentation segment offers essential products, software and services used to create actionable intelligence by measuring and monitoring a range of physical parameters in industrial applications, including electrical current, radio frequency signals, distance, pressure and temperature. The Industrial Technologies segment offers critical technical equipment, components, software and services for manufacturing, repair and transportation markets around the world.

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