Entegris, Inc. (ENTG) DCF Valuation & Fundamental Primer
Entegris, Inc. (ENTG) currently trades at $89.41 with an enterprise value of $7.17B. Our proprietary institutional model rates Entegris, Inc. at 58/100 (Grade: B · Mixed Fundamental Profile). The current market price prices in an implied 5-year revenue CAGR of 38.6% vs. historical growth of 14.9% (Aggressive Growth Expectations Priced In).
Institutional fundamental teardown of Entegris, Inc. (ENTG) covering SEC 10-K/10-Q cash flow conversion, SBC dilution friction, and Reverse-DCF valuation hurdles.
Entegris, Inc. (ENTG) 3-Scenario DCF Valuation Range
Stress-test ENTG's 5-year growth, target FCF margin, WACC, terminal methodology, and SBC/dilution friction in real time.
Split between 5-Year Explicit Cash Flows and Discounted Terminal Value
2D Institutional Valuation Sensitivity Heatmap
Implied share price & upside/downside spread across 25 valuation states (Current Price: $89.41).
| WACC \ Terminal | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 8.5% | $30.88 -65% | $34.28 -62% | $38.24 -57% | $42.92 -52% | $48.54 -46% |
| 9.3% | $25.36 -72% | $28.03 -69% | $31.10 -65% | $34.66 -61% | $38.84 -57% |
| 10.0% | $20.81 -77% | $22.96 -74% | $25.40 -72% | $28.18 -68% | $31.40 -65% |
| 10.8% | $17.01 -81% | $18.77 -79% | $20.74 -77% | $22.96 -74% | $25.50 -71% |
| 11.5% | $13.78 -85% | $15.24 -83% | $16.86 -81% | $18.67 -79% | $20.71 -77% |
Institutional Software Quality Scorecard (58/100 · Grade B)
Viable recurring software business but carries notable dilution, lower margins, or higher leverage.
Positive FCF but lower conversion efficiency due to capex or timing
Minimal dilution friction; management compensation aligned with shareholders
Sub-par gross margins; higher cost of delivery or hardware/services mix
Moderate leverage or cash burn; monitor liquidity runway
Core Investment Strengths & Moats
- Low dilution friction: SBC is only 2.0% of revenue
Key Operational & Dilution Risks
- Lower software gross margins (45.9%), indicating higher hosting or service delivery drag
Reverse-DCF Solver: What Growth is Priced Into ENTG?
The current share price demands 38.6% 5-year CAGR (42.2% net of SBC & dilution)—a +23.7% acceleration over historical run-rate (14.9%). Any growth slowdown risks valuation multiple contraction.
Headline Reverse-DCF ignores Stock-Based Compensation (2.0% of revenue) and annual share dilution (0.2%/yr). Accounting for both requires 42.2% 5-year revenue CAGR to justify $89.41/sh on a true per-share economic cash flow basis.
Entegris, Inc. (ENTG) 5-Year Fundamental Forecast
| Statement Line Item | TTM Audited Base | TTM | Y1 | Y2 | Y3 | Y4 | Y5 |
|---|---|---|---|---|---|---|---|
| Revenue | $3.24B | $3.24B | $3.72B | $4.28B | $4.92B | $5.65B | $6.49B |
| Gross Profit | $1.49B | $1.49B | $1.71B | $1.96B | $2.26B | $2.59B | $2.98B |
| Operating Income (EBIT) | $533.9M | $533.8M | $613.4M | $704.8M | $809.8M | $930.4M | $1.07B |
| Stock-Based Compensation (SBC) | $65.9M | $65.8M | $75.6M | $86.9M | $99.8M | $114.7M | $131.8M |
| Unlevered Free Cash Flow (FCF) | $316.1M | $316.0M | $363.1M | $417.2M | $479.4M | $550.8M | $632.9M |
| SBC-Adjusted True Cash Flow | $250.3M | $250.2M | $287.5M | $330.3M | $379.6M | $436.1M | $501.1M |
Software & Cloud Services Peer Comparables & Rule of 40 Regression
Rule of 40 vs. EV / Revenue Multiple Regression
OLS Fit: EV/Rev = -8.0 + 0.40 × (Rule of 40) · R² = 59%Stocks below the gold regression line trade at a discount relative to their Rule of 40 compounding efficiency.
| Company | Ticker | Market Cap | TTM Revenue | Gross Margin | FCF Margin | Rule of 40 | SBC % Rev | EV / Rev |
|---|---|---|---|---|---|---|---|---|
| Entegris, Inc. | ENTG | $13.55B | $3.24B | 45.9% | 9.8% | 24.7% | 2.0% | 5.3× |
| ServiceNow | NOW | $152.61B | $10.98B | 79.2% | 31.1% | 54.2% | 15.9% | 13.9× |
| Workday, Inc. | WDAY | $50.35B | $8.00B | 75.0% | 27.4% | 43.9% | 19.0% | 6.4× |
| Salesforce | CRM | $217.10B | $37.90B | 77.2% | 32.8% | 42.8% | 8.4% | 5.8× |
| Datadog | DDOG | $46.05B | $2.68B | 80.8% | 31.1% | 57.7% | 21.3% | 17.4× |
| Snowflake Inc. | SNOW | $71.79B | $3.63B | 66.5% | 25.2% | 57.7% | 40.8% | 20.0× |
| Hubspot | HUBS | $19.89B | $2.63B | 85.0% | 21.3% | 52.7% | 19.2% | 7.7× |
| Peer Cohort Median Benchmark (N=6) | 78.2% | 29.2% | 53.5% | 19.1% | 10.8× | |||
EV / Revenue Multiple Compression Stress Test
| Multiple Scenario | EV / Revenue | Implied Enterprise Value | Implied Equity Value | Implied Share Price | Delta vs Current |
|---|---|---|---|---|---|
| Current Multiple | 5.3× | $17.06B | $13.55B | $89.41 | 0.0% |
| -20% Multiple Compression | 4.2× | $13.65B | $10.14B | $66.90 | -20.0% |
| -35% Multiple Compression | 3.4× | $11.09B | $7.58B | $50.02 | -35.0% |
| Software Baseline Floor (5.0× EV/Rev) | 5.0× | $16.21B | $12.70B | $83.76 | -5.0% |
Frequently Asked Questions: Entegris, Inc. (ENTG) Valuation
What is Entegris, Inc. (ENTG)'s intrinsic DCF valuation and implied share price?
Based on audited SEC 10-K/10-Q filings and a 5-year 3-statement discounted cash flow (DCF) model, Entegris, Inc. (ENTG) has a Base Case implied value of $24.18 per share (with a Bear Case of -$0.61 and a Bull Case of $56.36), compared to its current price of $89.41. The model discounts projected free cash flows at a 10.0% WACC and a 2.5% terminal growth rate.
What is Entegris, Inc. (ENTG)'s Rule of 40 score and Free Cash Flow margin?
Entegris, Inc. achieves a Rule of 40 score of 24.7%, combining a 14.9% revenue growth run-rate with a 9.8% TTM free cash flow margin on $3.24B in trailing twelve-month revenue. In the Software & Cloud Services peer cohort, the median Rule of 40 benchmark is 53.5%.
What revenue growth rate is priced into ENTG stock according to Reverse-DCF analysis?
At $89.41 per share (Enterprise Value of $17.06B), our Reverse-DCF solver indicates the market is pricing in a 5-year implied revenue CAGR of 38.6%, compared to Entegris, Inc.'s historical CAGR of 14.9%. Overall market expectations are rated as "Aggressive Growth Expectations Priced In".
How does Entegris, Inc. compare to Software & Cloud Services software peers?
Entegris, Inc. (ENTG) earns an institutional Software Quality Score of 58/100 (Grade B — Mixed Fundamental Profile). Across its Software & Cloud Services peer group (NOW, WDAY, CRM, DDOG, SNOW), the cohort trades at a median EV/TTM Revenue multiple of 10.8× and a median gross margin of 78.2%.
How does Stock-Based Compensation (SBC) impact Entegris, Inc. (ENTG)'s valuation?
Entegris, Inc. recorded $65.9M in TTM stock-based compensation (2.0% of revenue). When treating SBC as a cash-equivalent compensation expense, Entegris, Inc.'s SBC-adjusted free cash flow yield is 1.8%, scoring 25/25 on our Shareholder Dilution Friction pillar.