Cabot Microelectronics (NASDAQ:CCMP) supplies high-performance chemical slurries and pads used in semiconductor manufacturing that remove excess material deposits, flattening and smoothing the surfaces of the layers of chips. It is the global leader in slurries with a 36% market share.
The stock was up about 20% through the first five months of 2018 as Cabot continues to benefit from the secular trend of increasing semiconductor manufacturing complexity. Additional steps in the manufacturing process means more polishing and thus more slurry usage.
Additionally, Cabot’s entry into the polishing pad market a few years ago, bolstered by an acquisition, opened up a large new addressable market, and Cabot is growing its pad business at a 20% annual clip as it continues to win share in an expanding market.
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