Entegris (NASDAQ:ENTG – Get Free Report) and Taiwan Semiconductor Manufacturing (NYSE:TSM – Get Free Report) are both large-cap technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, earnings, profitability, risk and dividends.
Profitability
This table compares Entegris and Taiwan Semiconductor Manufacturing’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Entegris | 9.18% | 12.25% | 5.84% |
| Taiwan Semiconductor Manufacturing | 51.51% | 42.84% | 29.37% |
Dividends
Entegris pays an annual dividend of $0.40 per share and has a dividend yield of 0.3%. Taiwan Semiconductor Manufacturing pays an annual dividend of $3.46 per share and has a dividend yield of 0.8%. Entegris pays out 20.1% of its earnings in the form of a dividend. Taiwan Semiconductor Manufacturing pays out 22.3% 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 summary of recent ratings and target prices for Entegris and Taiwan Semiconductor Manufacturing, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Entegris | 0 | 2 | 11 | 2 | 3.00 |
| Taiwan Semiconductor Manufacturing | 0 | 1 | 12 | 3 | 3.12 |
Entegris presently has a consensus price target of $181.67, indicating a potential upside of 14.03%. Taiwan Semiconductor Manufacturing has a consensus price target of $528.78, indicating a potential upside of 20.36%. Given Taiwan Semiconductor Manufacturing’s stronger consensus rating and higher possible upside, analysts plainly believe Taiwan Semiconductor Manufacturing is more favorable than Entegris.
Insider & Institutional Ownership
16.5% of Taiwan Semiconductor Manufacturing shares are held by institutional investors. 0.5% of Entegris shares are held by company insiders. Comparatively, 1.1% of Taiwan Semiconductor Manufacturing shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Earnings & Valuation
This table compares Entegris and Taiwan Semiconductor Manufacturing”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Entegris | $3.33 billion | 7.30 | $235.60 million | $1.99 | 80.06 |
| Taiwan Semiconductor Manufacturing | $122.42 billion | 18.61 | $54.12 billion | $15.54 | 28.27 |
Taiwan Semiconductor Manufacturing has higher revenue and earnings than Entegris. Taiwan Semiconductor Manufacturing is trading at a lower price-to-earnings ratio than Entegris, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Entegris has a beta of 1.4, suggesting that its stock price is 40% more volatile than the S&P 500. Comparatively, Taiwan Semiconductor Manufacturing has a beta of 1.37, suggesting that its stock price is 37% more volatile than the S&P 500.
Summary
Taiwan Semiconductor Manufacturing beats Entegris on 14 of the 17 factors compared between the two stocks.
About Entegris
Entegris, Inc. develops, manufactures, and supplies microcontamination control products, specialty chemicals, and advanced materials handling solutions in North America, Taiwan, China, South Korea, Japan, Europe, and Southeast Asia. It operates in three segments: Materials Solutions (MS); Microcontamination Control (MC); and Advanced Materials Handling (AMH). The MC segment solutions to purify critical liquid chemistries and process gases used in semiconductor manufacturing processes and other high-technology industries; integrated circuit chemical mechanical polishing solutions, high-performance etch and clean chemistries, gases and materials, and safe and materials delivery systems. The MS segment provides materials-based solutions, such as chemical mechanical planarization slurries, pads, deposition materials, process chemistries and gases, formulated cleans, etchants, and other specialty materials. The Advanced Materials Handling segment develops solutions for customers' yields by protecting critical materials during manufacturing, transportation, and storage, which include monitor, protect, transport and deliver critical liquid chemistries, wafers, and other substrates for semiconductor, life sciences and other high-technology industries. The company's customers include logic and memory semiconductor device manufacturers, semiconductor equipment makers, gas and chemical manufacturing companies, and wafer grower companies; and flat panel display equipment makers, panel manufacturers, and manufacturers of hard disk drive components and devices, as well as their related ecosystems. It serves manufacturers and suppliers in the solar and life science industries, electrical discharge machining customers, glass and glass container manufacturers, aerospace manufacturers, and manufacturers of biomedical implantation devices. Entegris, Inc. was founded in 1966 and is headquartered in Billerica, Massachusetts.
About Taiwan Semiconductor Manufacturing
Taiwan Semiconductor Manufacturing Company Limited, together with its subsidiaries, manufactures, packages, tests, and sells integrated circuits and other semiconductor devices in Taiwan, China, Europe, the Middle East, Africa, Japan, the United States, and internationally. It provides a range of wafer fabrication processes, including processes to manufacture complementary metal- oxide-semiconductor (CMOS) logic, mixed-signal, radio frequency, embedded memory, bipolar CMOS mixed-signal, and others. The company also offers customer and engineering support services; manufactures masks; and invests in technology start-up companies; researches, designs, develops, manufactures, packages, tests, and sells color filters; and provides investment services. Its products are used in high performance computing, smartphones, Internet of things, automotive, and digital consumer electronics. The company was incorporated in 1987 and is headquartered in Hsinchu City, Taiwan.
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