Cramer: This Chip Materials Maker is a Screaming Buy After a ‘Ridiculous’ Decline
In a volatile market where panic often overrules logic, CNBC’s Jim Cramer has identified a rare opportunity in the semiconductor sector. The Mad Money host labeled Entegris (NASDAQ: ENTG)—a key supplier to chipmakers—a “screaming buy” after its stock plunged nearly 30% from recent highs.
Why Entegris Stands Out
Entegris produces ultra-pure materials, filtration systems, and handling solutions that are mission-critical for semiconductor fabrication. As global demand for chips accelerates—driven by AI, 5G, and electric vehicles—Entegris operates as an unsung hero of the tech supply chain.
Cramer dismissed the recent sell-off as an overreaction: “This is a company with bulletproof fundamentals. The decline is ridiculous given its long-term growth trajectory.”
3 Catalysts Driving Entegris’ Recovery
- Semiconductor Mega-Trends
- AI data centers, IoT devices, and automotive chips require increasingly complex materials
-
The U.S. CHIPS Act is injecting $52B into domestic production, creating tailwinds
-
Financial Resilience
- 2023 revenue: $2.5B with industry-leading 45% gross margins
-
Mid-teens revenue growth projected through 2025
-
Attractive Valuation
- Trades at 20x forward P/E (below historical average)
- Strategic acquisitions (like CMC Materials) expanded moat
Risks Investors Should Monitor
While bullish, Cramer acknowledged potential challenges:
– Chip cycle volatility – Short-term inventory adjustments could pressure orders
– Competition – Rivals like Applied Materials offer overlapping solutions
– Macro headwinds – Rising interest rates may impact fab construction timelines
“These risks are already baked into the current price,” Cramer argued. “At these levels, you’re getting paid to take the long view.”
Key Takeaways for Investors
- Entegris supplies irreplaceable materials for cutting-edge chips
- 30% pullback creates rare value in a high-growth sector
- Upcoming earnings (July 26) could confirm turnaround
“When quality businesses go on sale, you buy,” Cramer concluded. “This is one of those moments.”
→ Watch List: Monitor Q2 earnings and updates on TSMC/Intel’s fab expansion plans.
