What to Expect From Analog Devices, Inc Q1 Results?

Edward Jones upgraded Analog Devices (NASDAQ:ADI) from Hold to Buy, recognizing the company's advantageous position to gain from the increasing demand for automation.

The analysts pointed out that the expansion of automated and connected devices across various sectors will likely lead to a higher number of chips required per device. This trend is expected to benefit Analog Devices significantly.

Furthermore, the firm anticipates a surge in chip demand due to the evolution of the automotive industry. Cars with advanced features and a shift towards more electric vehicles are predicted to necessitate a greater number of chips per vehicle.

The analyst also noted the unique advantages of Analog Devices' hybrid manufacturing approach. This strategy is believed to yield higher cash flow and require less capital investment compared to industry peers, thus enhancing the company's financial flexibility.

Currently, ADI's shares are trading at about 20 times Edward Jones' fiscal 2025 earnings estimate. This valuation aligns with its historical average. Despite ADI's recent underperformance compared to other technology stocks, partly due to a slowdown in chip demand and growth, the analysts see the shares as attractively valued and believe in the company's potential for recovery and growth.

Analog Devices (NASDAQ:ADI) shares dropped more than 7% on Wednesday after the company reported its Q2 earnings results. While both EPS of $2.83 and revenue of $3.26 billion came in better than the Street estimates of $2.75 and $3.21 billion, respectively, guidance missed the consensus estimates.

The company continued benefiting from rising semiconductor content in Automobile, Communications, and Industrial markets during the quarter.

For Q3/23, the company expects EPS to be in the range of $2.42-$2.62, compared to the Street estimate of $2.65, and revenue in the range of $3-$3.2 billion, compared to the Street estimate of $3.16 billion.

RBC Capital analysts provided their outlook on Analog Devices (NASDAQ:ADI) ahead of the upcoming Q2 earnings, scheduled on May 24.

The analysts see an in-line setup to Q2 Street sales/EPS estimates of $3.2 billion/$2.75 but stand cautious on Q3 as semi correction progresses.

Counter to peers, management posted beat/raise results led by auto/industrial. Industrial (52% of total revenue) was up 26% year-over-year in Q1 led by automation, sustainable energy, instrumentation, and test. Auto (22% of total revenues) up 30% year-over-year in Q1. According to the analysts, Q2 is expected up slightly.

RBC Capital analysts provided their outlook on Analog Devices (NASDAQ:ADI) ahead of the upcoming Q2 earnings, scheduled on May 24.

The analysts see an in-line setup to Q2 Street sales/EPS estimates of $3.2 billion/$2.75 but stand cautious on Q3 as semi correction progresses.

Counter to peers, management posted beat/raise results led by auto/industrial. Industrial (52% of total revenue) was up 26% year-over-year in Q1 led by automation, sustainable energy, instrumentation, and test. Auto (22% of total revenues) up 30% year-over-year in Q1. According to the analysts, Q2 is expected up slightly.

Analog Devices (NASDAQ:ADI) shares gained more than 7% on Wednesday after the company reported its Q1 results, with EPS of $2.75 coming in better than the Street estimate of $2.61. Revenue of $3.25 billion beat the Street estimate of $3.15 billion.

While lead times have shortened for much of the portfolio and longer-term cancellations have risen, the company cited still-strong demand in its core end markets of Industrial and Automotive and resumed its more bullish tone that it adopted on its November earnings call.

For Q2, the company expects EPS in the range of $2.65-$2.85, compared to the Street estimate of $2.42. Q2 revenue is seen at $3.1-3.3 billion, beating the Street estimate of $3.03 billion, once again bucking the trend of its competitors which almost universally guided below Street expectations this earnings season.

Analog Devices (NASDAQ:ADI) shares gained more than 7% on Wednesday after the company reported its Q1 results, with EPS of $2.75 coming in better than the Street estimate of $2.61. Revenue of $3.25 billion beat the Street estimate of $3.15 billion.

While lead times have shortened for much of the portfolio and longer-term cancellations have risen, the company cited still-strong demand in its core end markets of Industrial and Automotive and resumed its more bullish tone that it adopted on its November earnings call.

For Q2, the company expects EPS in the range of $2.65-$2.85, compared to the Street estimate of $2.42. Q2 revenue is seen at $3.1-3.3 billion, beating the Street estimate of $3.03 billion, once again bucking the trend of its competitors which almost universally guided below Street expectations this earnings season.

Deutsche Bank analysts provided their outlook on Analog Devices, Inc. (NASDAQ:ADI) ahead of the company’s upcoming Q1/23 earnings announcement today before the market opens.

The analysts see mixed trends heading into the report. On one hand, macro/business trends have clearly deteriorated over the last 90 days. On the other hand, the company's backlog remains extended even after extensive scrubbing, and Street estimates already contemplate a sub-seasonal decline in the April quarter.

Thus, while the analysts do expect a more cautious tone from the company in general to reflect elevated customer inventories and softer end demand, they still anticipate this quarter’s print/guide to be largely in-line with downward adjustments more likely to occur in out-quarters to yield slightly negative revisions to 2023/2024 estimates as the company’s elevated backlog normalizes.