Goldman Sachs initiates MKS Instruments stock with Sell rating on growth concerns

Investing.com

Published Jul 10, 2025 06:20AM ET

Goldman Sachs initiates MKS Instruments stock with Sell rating on growth concerns

Investing.com - Goldman Sachs has initiated coverage on MKS Instruments (NASDAQ:MKSI) with a Sell rating and a price target of $90.00. The target aligns with InvestingPro 's Fair Value analysis, which suggests the stock is currently overvalued. The company's P/E ratio stands at 31.17, while maintaining a 15-year track record of consistent dividend payments.

The investment bank believes MKS Instruments will struggle to outgrow its primary customer base, which consists mainly of large wafer fabrication equipment (WFE) suppliers.

Goldman Sachs notes that the semiconductor industry is currently operating in what it describes as a "mid-cycle landscape," creating challenges for MKS's growth trajectory.

The firm also anticipates that MKS Instruments' operating margins will remain "relatively range bound at current levels" due to what it characterizes as a "more fluid WFE environment."

This cautious outlook comes as MKS Instruments navigates market conditions in the semiconductor equipment sector, where it provides critical components and subsystems to major industry players.

In other recent news, MKS Instruments reported strong financial results for the first quarter of 2025, surpassing both earnings and revenue expectations. The company achieved earnings per share of $1.71, exceeding the forecast of $1.44, and reported revenue of $936 million, which was higher than the anticipated $915.12 million. Additionally, MKS Instruments announced a quarterly dividend of $0.22 per share, scheduled for distribution in June 2025. The company has also received shareholder approval to rebrand as MKS Inc., reflecting its growth beyond industrial instruments. Executive changes were announced, with James A. Schreiner returning to his previous role as Executive Vice President & Chief Operating Officer, while David P. Henry transitions to Executive Vice President, Global Strategic Marketing. Furthermore, TD Cowen reiterated its Buy rating for MKS Instruments, maintaining a price target of $120, citing the company's strong fundamentals and growth opportunities in the semiconductor sector. These developments highlight MKS Instruments' strategic moves and financial performance in the technology industry.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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