Analog Devices (ADI) closed at $204.86 in the latest trading session, marking a -0.17% move from the prior day. This change lagged the S&P 500's 0.67% gain on the day. Elsewhere, the Dow gained 0.38%, while the tech-heavy Nasdaq added 0.98%.Coming into today, shares of the semiconductor maker had lost 3.37% in the past month. In that same time, the Computer and Technology sector lost 0.79%, while the S&P 500 gained 2.07%.Market participants will be closely following the financial results of Analog Devices i ...

Analog Devices (ADI) closed the latest trading day at $206.01, indicating a +0.38% change from the previous session's end. The stock lagged the S&P 500's daily gain of 0.72%. Elsewhere, the Dow saw an upswing of 0.3%, while the tech-heavy Nasdaq appreciated by 1.35%.Shares of the semiconductor maker witnessed a loss of 5.85% over the previous month, trailing the performance of the Computer and Technology sector with its loss of 1.35% and the S&P 500's gain of 1.02%.Market participants will be closely follow ...

Core Viewpoint - The article discusses the reliability of brokerage recommendations, particularly focusing on Analog Devices (ADI), and highlights the potential misalignment of interests between brokerage analysts and retail investors [1][4]. Group 1: Brokerage Recommendations for Analog Devices - Analog Devices has an average brokerage recommendation (ABR) of 1.61, indicating a position between Strong Buy and Buy, based on recommendations from 28 brokerage firms [2]. - Out of the 28 recommendations, 19 are classified as Strong Buy, accounting for 67.9%, while only one is classified as Buy, representing 3.6% [2]. Group 2: Limitations of Brokerage Recommendations - The article suggests that relying solely on brokerage recommendations may not be advisable, as studies indicate these recommendations often do not effectively guide investors towards stocks with high price appreciation potential [4]. - Brokerage analysts tend to exhibit a positive bias in their ratings due to vested interests, leading to a disproportionate number of favorable ratings compared to negative ones [5][9]. Group 3: Zacks Rank as an Alternative - Zacks Rank is presented as a more reliable tool for stock evaluation, categorizing stocks from Strong Buy to Strong Sell based on earnings estimate revisions, which have shown a strong correlation with near-term stock price movements [7][10]. - The Zacks Rank is updated more frequently than the ABR, as it reflects real-time changes in earnings estimates, making it a timely indicator for predicting future stock prices [11]. Group 4: Current Outlook for Analog Devices - The Zacks Consensus Estimate for Analog Devices has decreased by 0.3% over the past month to $7.09, indicating growing pessimism among analysts regarding the company's earnings prospects [12]. - This decline in earnings estimates has resulted in a Zacks Rank of 4 (Sell) for Analog Devices, suggesting caution despite the favorable ABR [13].

Core Viewpoint - Analog Devices (ADI) has demonstrated strong performance in the semiconductor sector, with a 15.7% increase in shares over the past year, outperforming the industry average [1] Group 1: Company Performance and Strategy - ADI's resilience is highlighted by its advancements in integrating artificial intelligence (AI) technology into its products, enhancing customer experience and increasing design wins [2] - The company is well-positioned in growth markets, particularly in AI-related applications and data centers, which are expected to drive future performance [3] - The industrial segment has shown strong demand in AI applications and Aerospace & Defense, while the communications segment benefits from increased demand for AI-driven data centers [4] Group 2: Recent Developments - ADI's strategic acquisition of Flex Logix, a leader in embedded FPGA and AI technology, enhances its ability to provide innovative solutions in high-performance markets [5] - A partnership with Teradyne Robotics aims to develop advanced robotics, integrating ADI's technologies with edge-based AI and machine learning to improve manufacturing efficiency [6] Group 3: Financial Performance - ADI has consistently reported strong quarterly performance, surpassing earnings estimates in the last four quarters with an average surprise of 4.9% [7] - Analysts project ADI's earnings for 2025 to be $7.09 per share, reflecting an 11.1% year-over-year growth [7] Group 4: Challenges and Competition - ADI faces challenges from post-pandemic inventory corrections, macroeconomic uncertainties, and a cyclical downturn in the semiconductor industry [8] - Intense competition from companies like Texas Instruments and NXP Semiconductors in various segments, including industrial IoT and automotive applications, poses additional challenges [9][10]

Core Viewpoint - Analog Devices, Inc. will release its financial results for the first quarter of fiscal year 2025 on February 19, 2025, at 7:00 a.m. Eastern time, followed by a conference call at 10:00 a.m. the same day to discuss the results and business outlook [1]. Financial Results Announcement - The financial results will be announced via a press release, and a conference call will be hosted by key executives including the CEO and CFO [1]. - The conference call will be accessible live on the company's Investor Relations website, and participants need to pre-register to receive dial-in information [2]. Company Overview - Analog Devices, Inc. is a global leader in semiconductors, focusing on bridging physical and digital worlds to enable advancements in various sectors such as digitized factories, mobility, and digital healthcare [3]. - The company reported revenues exceeding $9 billion in FY24 and employs approximately 24,000 people globally [3].

Company Performance - Analog Devices (ADI) ended the latest trading session at $212.95, reflecting a +0.27% change from the previous day's close, outperforming the S&P 500's gain of 0.16% [1] - Over the past month, ADI shares experienced a loss of 1.96%, which is worse than the Computer and Technology sector's loss of 1.29% but better than the S&P 500's loss of 2.2% [1] Upcoming Earnings - The upcoming earnings disclosure for Analog Devices is anticipated, with projected earnings per share (EPS) of $1.54, indicating a 10.98% decrease from the same quarter last year [2] - Quarterly revenue is expected to be $2.36 billion, down 6.18% from the year-ago period [2] Fiscal Year Projections - For the entire fiscal year, earnings are projected at $7.09 per share and revenue at $10.17 billion, representing increases of +11.13% and +7.88% respectively from the prior year [3] - Recent changes to analyst estimates for Analog Devices are noted, with positive alterations indicating analyst optimism regarding the company's business and profitability [3] Stock Performance and Valuation - The Zacks Consensus EPS estimate has shifted 0.85% downward over the past month, and Analog Devices currently holds a Zacks Rank of 3 (Hold) [5] - The company is trading at a Forward P/E ratio of 29.95, which is a discount compared to the industry's average Forward P/E of 36.81 [6] - ADI has a PEG ratio of 2.43, compared to the Semiconductor - Analog and Mixed industry's average PEG ratio of 2.62 [6] Industry Context - The Semiconductor - Analog and Mixed industry is part of the Computer and Technology sector, currently holding a Zacks Industry Rank of 193, placing it in the bottom 24% of over 250 industries [7] - The Zacks Industry Rank assesses the strength of industry groups, with the top 50% rated industries outperforming the bottom half by a factor of 2 to 1 [7]

Core Viewpoint - Analog Devices reported its fourth-quarter fiscal 2024 earnings, with revenues of $2.44 billion, exceeding estimates and aligning with management's guidance. However, the overall performance showed a decline in key markets, particularly industrial and automotive sectors, leading to a significant year-over-year revenue drop for the fiscal year [2][6][19]. Financial Performance - Fourth-quarter revenues of $2.44 billion beat the Zacks Consensus Estimate by 1.5% [2] - Fiscal 2024 total revenues declined 23% year over year to $9.43 billion, surpassing the Zacks Consensus Estimate of $9.39 billion [6] - Non-GAAP earnings for Q4 were $1.67 per share, exceeding estimates by 1.83%, but down 16.9% year over year [14] - Adjusted gross margin contracted 230 basis points to 67.9%, and adjusted operating margin was 41.1%, down 360 basis points [5] Market Segment Performance - Industrial market revenues were $1.07 billion, accounting for 44% of total revenues, down 21% year over year [3] - Automotive market revenues totaled $717 million, representing 29% of revenues, down 2% from the previous year [4] - Communications market revenues were $275.6 million, down 18% year over year [17] - Consumer market revenues grew by 31% year over year to $379.7 million, reflecting strong performance [18] Shareholder Returns and Cash Flow - The company repurchased shares worth $95 million and paid $457 million in dividends during Q4 [8] - For fiscal 2024, Analog Devices returned over $2.4 billion to shareholders, including $616 million in share repurchases and $1.8 billion in dividends [8] - Operating cash flow for Q4 was $1.05 billion, with free cash flow of $855 million; for fiscal 2024, operating cash flow was $3.9 billion and free cash flow was $3.1 billion [21] Future Guidance - For Q1 fiscal 2025, management expects net sales of $2.35 billion (+/- $100 million) and a non-GAAP operating margin of 40% (+/- 100 bps) [9] - Non-GAAP earnings are projected to be $1.53 (+/- 10 cents) per share [9] Market Position and Estimates - The stock has a poor Growth Score of F and a D grade on the value side, placing it in the bottom 40% for investment strategy [11] - Estimates for the stock have trended downward, indicating a Zacks Rank 3 (Hold) [10][23]

Company Overview - Analog Devices (ADI) is a leading semiconductor company specializing in high-performance analog, mixed-signal, and digital signal processing technologies [1] Market Outlook - The business of Analog Devices is believed to have passed the bottom of end-market cycles, with expectations for recovery in the automotive and industrial markets [1] Investment Strategy - The investment approach focuses on fundamental, bottom-up, long-term, and quality growth-oriented strategies, targeting companies in niche markets with strong growth potential and sound management [1]

Core Viewpoint - Analog Devices, Inc. (ADI) is facing challenges in the current market, leading to questions about its premium valuation despite its strong reputation in the analog and mixed-signal semiconductor space [1][5][14]. Financial Performance - ADI's stock has gained 9% year-to-date, significantly lagging behind the Zacks Computer and Technology sector's growth of 34.1% and the S&P 500's rise of 27.7% [1][3]. - The company is currently trading 11% below its 52-week high reached in July [1]. Challenges Faced - ADI is experiencing underperformance due to macroeconomic factors such as post-pandemic inventory corrections, persistent inflation, and geopolitical tensions affecting customer spending [5]. - The semiconductor industry is undergoing a cyclical downturn, which has reached a low point earlier in fiscal 2024 [5]. - Intense competition from companies like Texas Instruments, ON Semiconductor, and NXP Semiconductors is impacting ADI's market position, particularly in automotive and renewable energy segments [6][7]. Strategic Initiatives - Despite challenges, ADI is focusing on product innovation across analog, digital, AI, and software solutions to drive growth in key segments [8]. - The company is investing in its semiconductor capabilities to enhance its industrial segment, particularly in sensor-to-cloud automation solutions [9]. - Growth is noted in ADI's automotive segment, especially in battery management systems and electrical grid storage systems [10]. Future Outlook - Zacks Consensus Estimates predict revenue growth of 8.2% in fiscal 2025 and 11.8% in 2026, with bottom-line growth expected to accelerate by 12% in 2025 and 19% in 2026 [12]. - ADI's commitment to innovation and a strong product pipeline position it well for recovery in 2025 and beyond [14][15].

Core Viewpoint - Analog Devices (ADI) has shown strong performance in the semiconductor industry, with an 8.3% year-to-date gain, contrasting with a 3.3% decline in the Zacks Semiconductor - Analog and Mixed industry, driven by its robust portfolio and strategic partnerships [1] Group 1: Strategic Alliances and Collaborations - ADI's partnership with Tata Group aims to enhance electronic manufacturing in India, involving companies like Tejas Networks and Tata Motors to utilize ADI's products in network infrastructure and electric vehicles [3] - Collaboration with Flagship Pioneering focuses on creating a digital biological world, combining expertise in applied biology and semiconductor engineering to advance biological insights and diagnostics [4] - The partnership with Honeywell aims to digitize commercial spaces efficiently, while the collaboration with Taiwan Semiconductor ensures long-term wafer capacity and stable chip supply [5] - ADI's early adoption of E²B technology with BMW Group for ambient lighting system design in vehicles highlights its innovation in the automotive sector [6] Group 2: Technological Advancements and Market Position - ADI's efforts to integrate artificial intelligence into its products are expected to enhance customer experience and drive business innovation [2] - Despite a strong portfolio, ADI faces competition from Texas Instruments, which is also advancing in generative AI capabilities and launching new products [8][9] Group 3: Financial Outlook - For Q1 fiscal 2025, ADI expects net sales of $2.35 billion, indicating a year-over-year decline of 6.1%, with non-GAAP earnings projected at $1.53 per share, reflecting an 8.7% decline [10][11] - ADI's valuation appears stretched, with a forward Price/Sales ratio of 10.36X compared to the industry's 7.16X, and currently holds a Zacks Rank 3 (Hold) [12]