ANALOG DEVICES INC (ADI) Stock Fundamental Analysis
NASDAQ:ADI - Nasdaq - US0326541051 - Common Stock - Currency: USD
Overall ADI gets a fundamental rating of 5 out of 10. We evaluated ADI against 110 industry peers in the Semiconductors & Semiconductor Equipment industry. ADI has only an average score on both its financial health and profitability. While showing a medium growth rate, ADI is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
ADI had positive earnings in the past year.
In the past year ADI had a positive cash flow from operations.
ADI had positive earnings in each of the past 5 years.
Each year in the past 5 years ADI had a positive operating cash flow.
1.2 Ratios
With a Return On Assets value of 3.26%, ADI perfoms like the industry average, outperforming 58.18% of the companies in the same industry.
ADI has a Return On Equity (4.46%) which is in line with its industry peers.
The Return On Invested Capital of ADI (4.03%) is comparable to the rest of the industry.
ADI had an Average Return On Invested Capital over the past 3 years of 6.33%. This is below the industry average of 11.17%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.26% | ||
| ROE | 4.46% | ||
| ROIC | 4.03% |
ROA(3y)5.22%
ROA(5y)4.8%
ROE(3y)7.17%
ROE(5y)7.07%
ROIC(3y)6.33%
ROIC(5y)5.91%
1.3 Margins
The Profit Margin of ADI (16.75%) is better than 77.27% of its industry peers.
ADI's Profit Margin has declined in the last couple of years.
With an excellent Operating Margin value of 21.67%, ADI belongs to the best of the industry, outperforming 83.64% of the companies in the same industry.
ADI's Operating Margin has declined in the last couple of years.
ADI's Gross Margin of 57.16% is fine compared to the rest of the industry. ADI outperforms 79.09% of its industry peers.
In the last couple of years the Gross Margin of ADI has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.67% | ||
| PM (TTM) | 16.75% | ||
| GM | 57.16% |
OM growth 3Y-5.6%
OM growth 5Y-6.15%
PM growth 3Y-2.98%
PM growth 5Y-5.24%
GM growth 3Y-2.63%
GM growth 5Y-3.15%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ADI is destroying value.
ADI has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, ADI has more shares outstanding
The debt/assets ratio for ADI is higher compared to a year ago.
2.2 Solvency
ADI has an Altman-Z score of 5.88. This indicates that ADI is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of ADI (5.88) is better than 64.55% of its industry peers.
ADI has a debt to FCF ratio of 2.38. This is a good value and a sign of high solvency as ADI would need 2.38 years to pay back of all of its debts.
ADI has a Debt to FCF ratio of 2.38. This is in the better half of the industry: ADI outperforms 67.27% of its industry peers.
ADI has a Debt/Equity ratio of 0.20. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of ADI (0.20) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.2 | ||
| Debt/FCF | 2.38 | ||
| Altman-Z | 5.88 |
ROIC/WACC0.35
WACC11.35%
2.3 Liquidity
A Current Ratio of 1.93 indicates that ADI should not have too much problems paying its short term obligations.
ADI has a Current ratio of 1.93. This is in the lower half of the industry: ADI underperforms 76.36% of its industry peers.
ADI has a Quick Ratio of 1.43. This is a normal value and indicates that ADI is financially healthy and should not expect problems in meeting its short term obligations.
ADI's Quick ratio of 1.43 is on the low side compared to the rest of the industry. ADI is outperformed by 72.73% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.93 | ||
| Quick Ratio | 1.43 |
3. Growth
3.1 Past
The earnings per share for ADI have decreased strongly by -30.68% in the last year.
The Earnings Per Share has been growing slightly by 4.42% on average over the past years.
The Revenue for ADI has decreased by -19.28% in the past year. This is quite bad
Measured over the past years, ADI shows a quite strong growth in Revenue. The Revenue has been growing by 9.49% on average per year.
EPS 1Y (TTM)-30.68%
EPS 3Y-0.26%
EPS 5Y4.42%
EPS Q2Q%-5.78%
Revenue 1Y (TTM)-19.28%
Revenue growth 3Y8.81%
Revenue growth 5Y9.49%
Sales Q2Q%-3.56%
3.2 Future
The Earnings Per Share is expected to grow by 19.94% on average over the next years. This is quite good.
Based on estimates for the next years, ADI will show a quite strong growth in Revenue. The Revenue will grow by 11.79% on average per year.
EPS Next Y13.4%
EPS Next 2Y17.83%
EPS Next 3Y18.58%
EPS Next 5Y19.94%
Revenue Next Year10.09%
Revenue Next 2Y11.57%
Revenue Next 3Y12.37%
Revenue Next 5Y11.79%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 35.75, which means the current valuation is very expensive for ADI.
ADI's Price/Earnings is on the same level as the industry average.
ADI is valuated rather expensively when we compare the Price/Earnings ratio to 26.60, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 25.34 indicates a quite expensive valuation of ADI.
ADI's Price/Forward Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.43, ADI is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 35.75 | ||
| Fwd PE | 25.34 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as ADI.
Based on the Price/Free Cash Flow ratio, ADI is valued a bit cheaper than 66.36% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 34.97 | ||
| EV/EBITDA | 27.91 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
ADI's earnings are expected to grow with 18.58% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.67
PEG (5Y)8.09
EPS Next 2Y17.83%
EPS Next 3Y18.58%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.74%, ADI has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.41, ADI pays a better dividend. On top of this ADI pays more dividend than 86.36% of the companies listed in the same industry.
Compared to the average S&P500 Dividend Yield of 2.36, ADI is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.74% |
5.2 History
The dividend of ADI is nicely growing with an annual growth rate of 11.42%!
ADI has paid a dividend for at least 10 years, which is a reliable track record.
ADI has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)11.42%
Div Incr Years20
Div Non Decr Years20
5.3 Sustainability
ADI pays out 116.74% of its income as dividend. This is not a sustainable payout ratio.
ADI's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP116.74%
EPS Next 2Y17.83%
EPS Next 3Y18.58%
224.49
-0.05 (-0.02%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners92.49%
Inst Owner Change-0.27%
Ins Owners0.03%
Ins Owner Change9.03%
Market Cap111.34B
Analysts78.89
Price Target241.3 (7.49%)
Short Float %1.58%
Short Ratio1.8
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.74% |
Yearly Dividend3.62
Dividend Growth(5Y)11.42%
DP116.74%
Div Incr Years20
Div Non Decr Years20
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.81%
Min EPS beat(2)1.02%
Max EPS beat(2)4.61%
EPS beat(4)4
Avg EPS beat(4)4.79%
Min EPS beat(4)1.02%
Max EPS beat(4)9.63%
EPS beat(8)6
Avg EPS beat(8)2.34%
EPS beat(12)10
Avg EPS beat(12)3.63%
EPS beat(16)14
Avg EPS beat(16)3.91%
Revenue beat(2)2
Avg Revenue beat(2)1.05%
Min Revenue beat(2)0.46%
Max Revenue beat(2)1.64%
Revenue beat(4)4
Avg Revenue beat(4)1.07%
Min Revenue beat(4)0.46%
Max Revenue beat(4)1.64%
Revenue beat(8)5
Avg Revenue beat(8)0.31%
Revenue beat(12)9
Avg Revenue beat(12)0.91%
Revenue beat(16)13
Avg Revenue beat(16)1.08%
PT rev (1m)-8.49%
PT rev (3m)-5.72%
EPS NQ rev (1m)0.2%
EPS NQ rev (3m)2.22%
EPS NY rev (1m)0.02%
EPS NY rev (3m)0.96%
Revenue NQ rev (1m)0.08%
Revenue NQ rev (3m)2.06%
Revenue NY rev (1m)0.15%
Revenue NY rev (3m)1.68%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 35.75 | ||
| Fwd PE | 25.34 | ||
| P/S | 11.92 | ||
| P/FCF | 34.97 | ||
| P/OCF | 28.99 | ||
| P/B | 3.17 | ||
| P/tB | N/A | ||
| EV/EBITDA | 27.91 |
EPS(TTM)6.28
EY2.8%
EPS(NY)8.86
Fwd EY3.95%
FCF(TTM)6.42
FCFY2.86%
OCF(TTM)7.74
OCFY3.45%
SpS18.83
BVpS70.71
TBVpS-2.13
PEG (NY)2.67
PEG (5Y)8.09
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.26% | ||
| ROE | 4.46% | ||
| ROCE | 4.5% | ||
| ROIC | 4.03% | ||
| ROICexc | 4.28% | ||
| ROICexgc | 27.41% | ||
| OM | 21.67% | ||
| PM (TTM) | 16.75% | ||
| GM | 57.16% | ||
| FCFM | 34.1% |
ROA(3y)5.22%
ROA(5y)4.8%
ROE(3y)7.17%
ROE(5y)7.07%
ROIC(3y)6.33%
ROIC(5y)5.91%
ROICexc(3y)6.53%
ROICexc(5y)6.17%
ROICexgc(3y)44.45%
ROICexgc(5y)45.96%
ROCE(3y)7.03%
ROCE(5y)6.55%
ROICexcg growth 3Y-18.89%
ROICexcg growth 5Y-14.51%
ROICexc growth 3Y4.4%
ROICexc growth 5Y-12.69%
OM growth 3Y-5.6%
OM growth 5Y-6.15%
PM growth 3Y-2.98%
PM growth 5Y-5.24%
GM growth 3Y-2.63%
GM growth 5Y-3.15%
F-Score5
Asset Turnover0.19
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.2 | ||
| Debt/FCF | 2.38 | ||
| Debt/EBITDA | 1.74 | ||
| Cap/Depr | 31.34% | ||
| Cap/Sales | 7.03% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 93.27% | ||
| Profit Quality | 203.6% | ||
| Current Ratio | 1.93 | ||
| Quick Ratio | 1.43 | ||
| Altman-Z | 5.88 |
F-Score5
WACC11.35%
ROIC/WACC0.35
Cap/Depr(3y)40.05%
Cap/Depr(5y)34.52%
Cap/Sales(3y)7.94%
Cap/Sales(5y)6.29%
Profit Quality(3y)145.19%
Profit Quality(5y)151.71%
High Growth Momentum
Growth
EPS 1Y (TTM)-30.68%
EPS 3Y-0.26%
EPS 5Y4.42%
EPS Q2Q%-5.78%
EPS Next Y13.4%
EPS Next 2Y17.83%
EPS Next 3Y18.58%
EPS Next 5Y19.94%
Revenue 1Y (TTM)-19.28%
Revenue growth 3Y8.81%
Revenue growth 5Y9.49%
Sales Q2Q%-3.56%
Revenue Next Year10.09%
Revenue Next 2Y11.57%
Revenue Next 3Y12.37%
Revenue Next 5Y11.79%
EBIT growth 1Y-41.44%
EBIT growth 3Y2.72%
EBIT growth 5Y2.76%
EBIT Next Year46.87%
EBIT Next 3Y21.09%
EBIT Next 5Y18.97%
FCF growth 1Y-25.27%
FCF growth 3Y9.29%
FCF growth 5Y9.56%
OCF growth 1Y-23.58%
OCF growth 3Y12.1%
OCF growth 5Y11.33%