Key Takeaways
- Six funds added MKS in the third quarter, led by FengHe, which made it its No. 2 position.
- MKS is 52% below its high despite a record quarter, with EPS expected to nearly double this year.
- At 11x forward earnings, it trades well below its 18.5x 5-year average.
- It looks like a bargain, with chip spending as the risk.
Six funds with at least $2 billion each added MKS (MKSI) in the third quarter, according to 13Fs for the quarter ended Sept. 30, filed from Nov. 2 to Nov. 13. It has kept sliding: it’s down 19% from its Sept. 30 price and 52% below its 52-week high.
It has company. Coherent (COHR) sank after its own strong quarter, and one of the six funds also opened a new stake in Keysight (KEYS).
FengHe Made the Biggest Bet on MKS
All six held more MKS on Sept. 30 than on June 30:
| Fund | Size | MKS stake, Sept. 30 | Change in shares | Share of its 13F stocks |
|---|---|---|---|---|
| FengHe Fund Management | $2.1 billion | $205 million | +33% | 9.9% |
| Carmignac | $7.4 billion | $101 million | New | 1.4% |
| Blue Grotto Capital | $2.1 billion | $61 million | +54% | 4.2% |
| Bowie Capital Management | $2.8 billion | $53 million | +372% | 3.3% |
| Spyglass Capital Management | $2.0 billion | $48 million | +53% | 2.8% |
| Senator Investment Group | $4.9 billion | $33 million | +92% | 1.3% |
Source: each fund’s 13F for the quarter ended Sept. 30, at quarter-end prices. Size is what each firm manages on its latest Form ADV; for Carmignac and FengHe, it’s what their 13Fs hold in US stocks.
FengHe’s 771,263 shares make MKS its second-largest position. Bowie held nearly five times as many shares as on June 30, and Senator nearly twice as many. Blue Grotto’s new Keysight position, worth $73 million, is a bit bigger than its MKS stake. None of that shows what they hold today.
TIKR Tracks 14 Analysts on MKS. How Many Say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on MKS, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See MKS’s Analyst Ratings
MKS Just Posted a Record Quarter
MKS’s Nov. 4 report beat its own guidance. Revenue hit a record $1.41 billion, above guidance, with semiconductor sales up 54%. Non-GAAP EPS was a record $4.18. MKS guided to $1.49 billion of fourth-quarter revenue and authorized a $500 million buyback. CEO John T.C. Lee cited “robust orders and new design wins.”
Good news hasn’t been enough for AI hardware lately. Coherent sank 16% on Nov. 5 despite a hyperscaler deal B. Riley values at about $20 billion. Earnings Whispers flagged soft spots, including gross margin plateauing near 48% and a lower tax rate helping the $5.00 EPS guide, but read MKS’s slide as investors “pricing peak-cycle fears that this report did little to validate.”
At 11x, MKS Is Priced for a Downturn
Analysts expect normalized EPS to nearly double from $7.88 in 2025 to $14.83 this year, then reach $19.71 in 2027:
That matches MKS’s own $9.80 through September plus its $5.00 fourth-quarter guide.
Yet the multiple keeps shrinking:
MKS trades at 11x forward earnings, against a 5-year average of 18.5x and a peak of 35x on June 30. The low, 8.2x, came in October 2022.
Targets have come down, but not to the price:
The consensus target was $338 on Nov. 6, down from $420 on Aug. 23 but double the $164 of a year earlier, and 57% above Friday’s $215.65 close. The lowest target, $195, sits under the price.
Why MKS Looks Like a Bargain
If AI spending slows, 2027 estimates fall and 11x stops looking cheap.
But a company posting records, guiding higher, authorizing a buyback and trading 40% under its usual multiple isn’t priced for the business it’s reporting. I’d side with the six funds. The next check is orders in MKS’s fourth-quarter report, and the funds’ next 13Fs, due by mid-February, will show who held on.
So What Is MKS Stock Actually Worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
