In the latest trading session, Analog Devices (ADI) closed at $393.64, marking a +2.14% move from the previous day. The stock exceeded the S&P 500, which registered a gain of 0.81% for the day. At the same time, the Dow added 0.27%, and the tech-heavy Nasdaq gained 1.3%.
Shares of the semiconductor maker have depreciated by 1.85% over the course of the past month, underperforming the Computer and Technology sector's loss of 1.59%, and the S&P 500's gain of 1.13%.
Investors will be eagerly watching for the performance of Analog Devices in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $3.33, marking a 62.44% rise compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $3.93 billion, showing a 36.28% escalation compared to the year-ago quarter.
For the annual period, the Zacks Consensus Estimates anticipate earnings of $12.41 per share and a revenue of $14.58 billion, signifying shifts of +59.31% and +32.29%, respectively, from the last year.
Investors might also notice recent changes to analyst estimates for Analog Devices. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Analog Devices is currently sporting a Zacks Rank of #1 (Strong Buy).
In terms of valuation, Analog Devices is presently being traded at a Forward P/E ratio of 31.05. For comparison, its industry has an average Forward P/E of 48.47, which means Analog Devices is trading at a discount to the group.
We can additionally observe that ADI currently boasts a PEG ratio of 1.08. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The average PEG ratio for the Semiconductor - Analog and Mixed industry stood at 1.01 at the close of the market yesterday.
The Semiconductor - Analog and Mixed industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 17, placing it within the top 7% of over 250 industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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Analog Devices, Inc. (ADI): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).