ADI AI Stock Analysis – Buy, Hold, or Avoid?
Analog Devices, Inc. (ADI)
Fundamentals
Analog Devices, Inc. (ADI) demonstrates robust financial health characterized by solid revenue and earnings growth, supported by strong operating margins and efficient cost management. The company's steady increase in EPS and revenue with consistent beats over recent quarters reflects strong operational execution and sustainable growth drivers in the semiconductor sector.
Financial Highlights
- Revenue
- Net Income
- Net Margin (%)
Revenue
37.25% YoY
Q1 2026
Net Income
106.46% YoY
Q1 2026
Net Margin
Q1 2026
Growth Metrics
Revenue Growth YoY
Latest Quarter: Q1 2026
Net Income Growth YoY
Latest Quarter: Q1 2026
Revenue Per Share Growth YoY
Latest Quarter: Q1 2026
EPS Growth YoY
Latest Quarter: Q1 2026
Book Value Per Share Growth YoY
Latest Quarter: Q1 2026
| Q1 2026 | Q4 2025 | Q3 2025 | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | |
|---|---|---|---|---|---|---|---|---|
| Revenue | 3.6B | 3.2B | 3.1B | 2.9B | 2.6B | 2.4B | 2.4B | 2.3B |
| Revenue Growth YoY | +37.25% | +30.42% | +25.90% | +24.57% | +22.28% | -3.56% | -10.06% | -24.84% |
| Net Income | 1.2B | 830.8M | 787.7M | 518.5M | 569.8M | 391.3M | 478.1M | 392.2M |
| Net Income Growth YoY | +106.46% | +112.32% | +64.77% | +32.20% | +88.51% | -15.43% | -4.08% | -55.28% |
| EPS | $2.41 | $1.70 | $1.60 | $1.05 | $1.15 | $0.79 | $0.96 | $0.79 |
| EPS Growth YoY | +109.57% | +115.19% | +66.67% | +32.91% | +88.52% | -15.05% | -3.03% | -54.86% |
Profitability Metrics
Technical Analysis
Analog Devices (ADI) is currently exhibiting mixed technical signals characterized by a long-term rising trend channel but recent bearish indicators from a double top breakdown and MACD bearish momentum. Price is testing critical support near $363, with the near-term trend showing weakness and sideways to slightly bearish momentum. Key technical indicators suggest caution despite medium-term bullish structures still intact.
No extreme reading
Mixed signals
Trend developing
Watching for cross
Key Technical Values
Price with Moving Averages
50-day, 150-day and 200-day simple moving averages
Relative Strength Index
Momentum oscillator measuring speed and magnitude of price changes
RSI (14)
Earnings
Analog Devices, Inc. (ADI) demonstrates robust financial health characterized by solid revenue and earnings growth, supported by strong operating margins and efficient cost management. The company's steady increase in EPS and revenue with consistent beats over recent quarters reflects strong operational execution and sustainable growth drivers in the semiconductor sector.
Latest Earnings
Q1 2026 Earnings (May 2, 2026)
Earnings Per Share (EPS)
Actual
$3.09
Estimated
$2.89
Surprise
+$0.20
Surprise %
+6.92%
Revenue
Actual
$3.62B
Estimated
$3.51B
Surprise
+$110.35M
Surprise %
+3.14%
Historical Earnings
| Q1 2026 | Q4 2025 | Q3 2025 | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | |
|---|---|---|---|---|---|---|---|---|
| Earnings Per Share | ||||||||
| EPS (Actual) | $3.09 | $2.46 | $2.26 | $2.05 | $1.85 | $1.63 | $1.67 | $1.58 |
| EPS (Estimated) | $2.89 | $2.31 | $2.24 | $1.95 | $1.70 | $1.54 | $1.64 | $1.51 |
| EPS Surprise | +$0.20 | +$0.15 | +$0.02 | +$0.10 | +$0.15 | +$0.09 | +$0.03 | +$0.07 |
| % Diff | +6.9% | +6.5% | +0.9% | +5.1% | +8.8% | +5.8% | +1.8% | +4.6% |
| Revenue | ||||||||
| Revenue (Actual) | $3.62B | $3.16B | $3.08B | $2.88B | $2.64B | $2.42B | $2.44B | $2.31B |
| Revenue (Estimated) | $3.51B | $3.12B | $3B | $2.77B | $2.51B | $2.36B | $2.41B | $2.27B |
| Revenue Surprise | +$110.35M | +$42.63M | +$71.94M | +$111.87M | +$126.85M | +$63.14M | +$37.86M | +$37.23M |
| % Diff | +3.1% | +1.4% | +2.4% | +4.0% | +5.0% | +2.7% | +1.6% | +1.6% |
Valuation
Analog Devices (ADI) currently trades with premium valuation multiples above both its historical averages and most semiconductor peers, reflecting strong growth expectations primarily driven by AI and industrial sector demand. Despite recent news of a data breach, analysts maintain a generally positive sentiment with a consensus buy rating and an average price target implying over 20% upside. The company's strong financial health, solid margins, and robust revenue growth prospects justify a degree of valuation premium, though multiples remain elevated relative to typical semiconductor valuations.
Valuation Metrics
Price to Earnings
TTM
Price to Sales
TTM
Price to Book
TTM
Enterprise Value to EBITDA
TTM
Enterprise Value to Revenue
TTM
| Q1 2026 | Q4 2025 | Q3 2025 | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | |
|---|---|---|---|---|---|---|---|---|
| Price to Earnings | 41.25 | 45.72 | 36.58 | 52.79 | 43.17 | 67.05 | 58.72 | 65.81 |
| Price to Sales | 53.52 | 48.09 | 37.36 | 38.05 | 37.32 | 43.38 | 45.79 | 44.64 |
| Price to Book | 5.75 | 4.50 | 3.40 | 3.22 | 2.81 | 3.00 | 3.18 | 2.93 |
| Enterprise Value to EBITDA | 105.16 | 103.60 | 82.33 | 87.18 | 86.04 | 107.50 | 104.98 | 105.17 |
| Enterprise Value to Revenue | 55.24 | 49.92 | 39.36 | 40.27 | 39.15 | 45.53 | 48.11 | 47.23 |
Sentiment & Analyst Ratings
The overall sentiment on Analog Devices (ADI) is positive, supported by strong analyst buy ratings and optimistic price targets suggesting significant upside. Despite recent short-term stock volatility linked to sector-wide influences and security concerns, the long-term growth outlook remains strong due to strategic acquisitions and robust financial performance. Retail and professional investors appear confident, though cautious monitoring of cybersecurity developments is advised.
Analyst Recommendations
Risk Assessment
Analog Devices (ADI) demonstrates a solid financial foundation with strong liquidity and moderate leverage, supporting its capability to meet short- and long-term obligations. However, the company faces risks including recent cybersecurity incidents, supply chain constraints amid rising global demand, and intense competitive pressure within the dynamic semiconductor sector. While the business is positioned for growth driven by AI and data center demand, regulatory and geopolitical uncertainties remain notable concerns for investors.
Liquidity & Solvency
Frequently Asked Questions about ADI
AI Answers: Common Questions About ADI
Get AI-powered answers to the questions investors ask most about Analog Devices, Inc.
Yes, ADI is a good buy for medium to long-term investors given its 49% revenue growth over two years, EPS growth from $0.61 to $3.09, and expanding gross margins above 67%. Analysts expect over 20% upside from current levels.
Not recommended to sell currently unless short-term technical breakdown below $363 support occurs or if cybersecurity issues materially worsen. Fundamentals and sentiment remain positive.
Key risks include semiconductor cyclicality, supply chain constraints, cybersecurity breaches, and geopolitical trade tensions, particularly involving China.
Consensus analyst price targets imply over 20% upside from the current $367.41 price, supported by strong earnings growth and strategic acquisitions.
ADI trades at a premium P/E of 37.26 and elevated EV/EBITDA ratios above sector averages, justified by strong growth in AI and industrial markets but leaving limited margin for earnings disappointments.
Strong fundamentals with accelerating revenue from $2.16B to $3.62B in two years, EPS growth from $0.61 to $3.09, and gross margin expansion from 57% to 67%. Operating margins improved from 18% to 38%, reflecting operational leverage and cost discipline.
Short-term technicals are bearish with a double top breakdown below $384 and MACD negative momentum. Price is testing critical support at $363. Medium-term trend remains upward within a rising channel.
Upcoming earnings reports, continued AI and industrial sector growth, and successful integration of recent acquisitions like Empower Semiconductor are key catalysts.
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