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Why Are Entegris (ENTG) Shares Soaring Today

ENTG Cover Image

What Happened?

Shares of semiconductor materials supplier Entegris (NASDAQ: ENTG) jumped 5.2% in the afternoon session after a wave of positive news in the semiconductor sector, particularly SK hynix's announcement that it has completed the development of next-generation HBM4 memory chips. 

SK hynix's new HBM4 memory boasts double the bandwidth and a 40% improvement in power efficiency, an advancement expected to significantly boost AI service performance. As a key supplier of materials for the semiconductor industry, Entegris is well-positioned to benefit from the production of these more advanced chips. The positive sentiment was further supported by news of a deal between Taiwan and the United Kingdom to collaborate on developing talent in the semiconductor sector, signaling strong global support for the industry's growth.

The shares closed the day at $87.22, up 4.4% from previous close.

Is now the time to buy Entegris? Access our full analysis report here, it’s free.

What Is The Market Telling Us

Entegris’s shares are extremely volatile and have had 30 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was about 1 month ago when the stock gained 5% on the news that the semiconductor sector continued to rally as a favorable July inflation report boosted investor confidence for a potential Federal Reserve interest rate cut in September. Lower-than-expected inflation data for July increased market expectations for a Federal Reserve interest rate cut next month, with futures markets pricing in a 96.2% probability. A potential rate cut lowers borrowing costs, which is particularly beneficial for growth-oriented sectors like technology and semiconductors as it can fuel investment and expansion.

Entegris is down 10.3% since the beginning of the year, and at $87.25 per share, it is trading 25.2% below its 52-week high of $116.61 from September 2024. Investors who bought $1,000 worth of Entegris’s shares 5 years ago would now be looking at an investment worth $1,290.

Unless you’ve been living under a rock, it should be obvious by now that generative AI is going to have a huge impact on how large corporations do business. While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) semiconductor stock benefiting from the rise of AI. Click here to access our free report on our favorite semiconductor growth story.

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