Analog Devices (ADI) Outpaces Stock Market Gains: What You Should Know
In the latest trading session, Analog Devices (ADI) closed at $170.67, marking a +0.89% move from the previous day. The stock outpaced the S&P 500's daily gain of 0.75%.
Prior to today's trading, shares of the semiconductor maker had gained 4.38% over the past month. This has lagged the Computer and Technology sector's gain of 6.19% and outpaced the S&P 500's gain of 2.91% in that time.
ADI will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.61, up 18.38% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.7 billion, up 17.06% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $6.28 per share and revenue of $6.66 billion. These totals would mark changes of +27.9% and +18.78%, respectively, from last year.
Any recent changes to analyst estimates for ADI should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.1% higher within the past month. ADI is holding a Zacks Rank of #3 (Hold) right now.
Digging into valuation, ADI currently has a Forward P/E ratio of 26.95. This valuation marks a no noticeable deviation compared to its industry's average Forward P/E of 26.95.
We can also see that ADI currently has a PEG ratio of 2.2. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Semiconductor - Analog and Mixed stocks are, on average, holding a PEG ratio of 2.1 based on yesterday's closing prices.
The Semiconductor - Analog and Mixed industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 86, which puts it in the top 34% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow ADI in the coming trading sessions, be sure to utilize Zacks.com.
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