What Makes MKS Instruments (MKSI) a Strong Investment?

Madison Investments, an investment advisor, released its “Madison Mid Cap Fund” first-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter, the fund (Class I) decreased 4.15% compared to the 3.40% decrease for the Russell Midcap Index. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, Madison Mid Cap Fund highlighted stocks such as MKS Instruments, Inc. (NASDAQ:MKSI). MKS Instruments, Inc. (NASDAQ:MKSI) offers technology solutions to semiconductor manufacturing, electronics and packaging, and specialty industrial applications. The one-month return of MKS Instruments, Inc. (NASDAQ:MKSI) was -28.27%, and its shares lost 44.75% of their value over the last 52 weeks. On April 22, 2025, MKS Instruments, Inc. (NASDAQ:MKSI) stock closed at $62.86 per share with a market capitalization of $4.298 billion.

Madison Mid Cap Fund stated the following regarding MKS Instruments, Inc. (NASDAQ:MKSI) in its Q1 2025 investor letter:

“The bottom five detractors for the quarter were Ross Stores, Gartner, MKS Instruments, Inc. (NASDAQ:MKSI), Arista Networks, and Thor Industries. MKS Instruments continues to suffer from very weak end market demand for its instruments and systems, primarily sold to semiconductor manufacturers, but also to electronics and industrial manufacturers.

We added to MKS Instruments. End market demand remains difficult, as described above, but there are some green shoots forming. Perhaps more importantly, MKS’ competitive positioning remains very strong and its earnings power once the semiconductor industry rebounds is quite appealing.”

Is MKS Instruments Inc. (MKSI) the Best Scientific Instruments Stock to Buy Right Now?

A scientist working on a complex photonics instruments in a sterile laboratory setting.

MKS Instruments, Inc. (NASDAQ:MKSI) is not on our list of 30 Most Popular Stocks Among Hedge Funds. Our database shows that 41 hedge fund portfolios held MKS Instruments, Inc. (NASDAQ:MKSI) at the end of the fourth quarter, compared to 40 in the third quarter. MKS Instruments, Inc. (NASDAQ:MKSI) generated revenue of $935 million in the fourth quarter of 2024, up 4% sequentially and 5% year-over-year. While we acknowledge the potential of MKS Instruments, Inc. (NASDAQ:MKSI) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

In another article, we covered MKS Instruments, Inc. (NASDAQ:MKSI) and shared Madison Mid Cap Fund’s views on the company. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.