In a report released today, Rick Schafer from Oppenheimer maintained a Buy rating on Analog Devices (ADI), with a price target of $110. The company’s shares closed yesterday at $89.82.
Schafer observed:
“ADI reports earnings Tuesday (11/20). We see F4Q(Oct) Sales/EPS roughly in line with consensus $1.57B/$1.52E, but see negative bias to the F1Q(Jan) outlook vs. Street $1.5B/$1.36E. We cut HPA estimates for ADI and peers following TXN’s earnings last month. Since then, we’ve heard commentary regarding broad-based demand softness, particularly in industrial segment, where ADI has some of the highest exposure (~50%). Macro uncertainty surrounding tariffs/trade wars has soured investor sentiment on the group. We see the group in early-stage correction as demand softens and estimates are revised lower for most. Near term, we expect the group to be under pressure until macro visibility improves and/or estimates are deemed sufficiently de-risked. Long term we like ADI’s rich industrial/auto/comm- heavy revenue mix and leading 70%/40%/40% GM/OM/FCF margin profile.”
According to TipRanks.com, Schafer is a 5-star analyst with an average return of 13.7% and a 65.2% success rate. Schafer covers the Consumer Goods sector, focusing on stocks such as Akoustis Technologies, Skyworks Solutions, and Texas Instruments.
The word on The Street in general, suggests a Moderate Buy analyst consensus rating for Analog Devices with a $106.89 average price target.
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Based on Analog Devices’ latest earnings release for the quarter ending July 31, the company reported a quarterly net profit of $413 million. In comparison, last year the company had a net profit of $346 million.
Based on the recent corporate insider activity of 89 insiders, corporate insider sentiment is negative on the stock. Most recently, in August 2018, Joseph Hassett, the SVP, Global Operations & Tech of ADI sold 12,000 shares for a total of $1,204,800.
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Analog Devices, Inc. engages in the design, manufacture, and market of analog, mixed-signal, and digital signal processing integrated circuits used in virtually all types of electronic equipment. Its products include data converters; amplifiers and linear products; radio frequency integrated circuits; power management products; sensors based on microelectro mechanical systems technology; and other sensors and processing products, including digital signal processing and other processors. The company was founded by Raymond P. Stata and Matthew Lorber in 1965 and is headquartered in Norwood, MA.
