Noor Ul Ain Rehman
2 min read
In This Article:
On May 23, analyst Christopher Rolland of Susquehanna reiterated a Buy rating on Analog Devices Inc. (NASDAQ:ADI) and set a price target of $280.00.
The rating followed the release of the company's solid fiscal Q2 2025 results, with revenue and EPS coming in at the high end of its guidance. Analog Devices Inc. (NASDAQ:ADI) reported $2.64 billion in revenue, with double-digit year-over-year growth across all end markets. It expects revenue for fiscal Q3 2025 to be around $2.75 billion, +/- $100 million.
A technician working on power management in a semiconductor factory.
The analyst supported his Buy rating with these results, stating that the higher-than-expected guidance and results were supported by rising demand in the automotive sector, especially in power solutions and connectivity, and a cyclical recovery. Automotive revenue comprised 32% of the total revenue, showing a 24% year-over-year and 16% sequential growth.
The firm further noted that another factor supporting the growth is a widening recovery across industrial regions and subsectors, with a book-to-bill ratio above 1.0. The industrial segment underwent a 17% year-over-year and 8% sequential growth, supported by broad recovery across subsectors and suggesting strong future demand. According to the analyst, the rising demand in communications is also proving beneficial for Analog Devices Inc. (NASDAQ:ADI), bolstered by AI infrastructure buildouts.
Although the effects of tariffs may bring some conservatism, the analyst expects Analog Devices Inc. (NASDAQ:ADI) to return to growth in fiscal year 2025. Management is confident about its ability to attain higher growth rates, and the analyst believes that the company's ability to effectively manage inventory and outperform its peers further positions it for long-term growth.
Analog Devices Inc. (NASDAQ:ADI) is a semiconductor company that combines digital, analog, and software technologies into engineering solutions. Its products include digital signal processing and system, analog and mixed signals, power management and reference, amplifiers radio frequency, and more.
While we acknowledge the potential of ADI as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than ADI and that has 100x upside potential, check out our report about the cheapest AI stock.
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Disclosure: None.
