Sprouts Farmers Market closes $600 million revolving credit facility
On Thursday, Wolfe Research adjusted its price target for Analog Devices stock (NASDAQ: NASDAQ:ADI), lowering it to $280 from the previous $295, while maintaining an Outperform rating. With the stock currently trading at $211.71 and sporting a P/E ratio of 67.71, InvestingPro data suggests the stock is trading at premium valuations. The revised price target is based on a projected earnings multiple slightly above the company’s average over the past year.
The firm’s analyst, Chris Caso, noted that the new price target reflects a valuation of approximately 28 times the expected earnings per share (EPS) of around $10, which is a modest increase from Analog Devices’ historical average multiple of 27 times. This optimism aligns with broader market sentiment, as InvestingPro reveals 19 analysts have recently revised their earnings estimates upward, with price targets ranging from $155 to $300. Despite the reduction in the price target, Wolfe Research’s outlook for the company remains positive, with a continued recommendation for investors to maintain their positions.
Wolfe Research’s FY26 EPS estimate for Analog Devices has been slightly raised to $9.15 following the company’s recent financial report. The CY26 EPS forecast is $9.60, aligning closely with the firm’s longstanding expectation of a $10 EPS power for Analog Devices. According to the analyst, with the stock currently trading at 22 times that earnings power, the valuation is still considered reasonable. Notably, InvestingPro data shows ADI has maintained dividend payments for 23 consecutive years, with a current yield of 1.78% and impressive 15.12% dividend growth in the last twelve months.
The analyst expressed the view that for Analog Devices to achieve sustainable growth in its stock price, the company will need to demonstrate a higher earnings power. However, Wolfe Research believes it is sensible for investors to hold onto their shares during this early stage of economic recovery, anticipating revenue and margin improvements for the company. The company maintains a strong financial position with a current ratio of 1.93, indicating healthy liquidity. For deeper insights into ADI’s valuation and growth prospects, investors can access comprehensive analysis and 13 additional ProTips through InvestingPro’s detailed research reports.
In other recent news, Analog Devices reported its financial results for the second quarter of 2025, exceeding earnings and revenue expectations. The company achieved an earnings per share (EPS) of $1.85, surpassing the projected $1.70, and reported revenue of $2.64 billion, which was above the anticipated $2.51 billion. Despite these positive results, the stock price experienced a decline. CFRA has raised the price target for Analog Devices to $265 from $250, maintaining a Buy rating, due to expectations of an order rebound. The firm noted that Analog Devices is positioned for a sustained cyclical recovery, with improving bookings in the industrial and automotive markets. Additionally, Analog Devices announced a new $10 billion share buyback program and an 8% dividend increase. Operating cash flow was reported at 47% of sales, with a free cash flow margin of 40%. Looking forward, the company projects third-quarter revenue to be approximately $2.75 billion, with expected growth particularly in the industrial segment.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.