Quick take
Stifel raised its target price for Analog Devices Inc. (NASDAQ: ADI) to $360 from $330 and reiterated a Buy rating on the shares. The new target sits above ADI's current trading level of $336.54, which is roughly 1% below its 52-week high of $343.96.
Quarterly outlook and drivers
Stifel said it now expects January quarter revenue to land at or modestly above its $3.10 billion estimate, marking a sequential increase of about 0.8%. The firm attributes that outlook to a normalization of bookings and a lean channel inventory position of approximately six weeks. Those dynamics, Stifel argues, would sustain the company’s growth trajectory; Analog Devices reported $11.02 billion in revenue over the past twelve months, equal to reported revenue growth of 16.89%.
On a segment basis, Stifel anticipates that communications revenue will run roughly 10% above seasonal norms while industrial revenue could come in in the mid-single digits above seasonal expectations. Those gains are expected to offset sequential pullbacks in automotive and consumer end markets, according to the firm.
Peer momentum and company financials
Stifel cited encouraging results from peer semiconductor companies including Texas Instruments, NXP Semiconductors, Microchip Technology and ON Semiconductor as evidence of a wider industry recovery. The broker also noted company-level metrics: third-party data show Analog Devices as a longstanding payer of dividends, with 23 consecutive years of distributions, and operating with a moderate level of debt.
Looking ahead to April quarter
The firm projects the April quarter could come in just above its $3.22 billion revenue estimate, implying sequential revenue growth of about 4.0%. Stifel highlighted areas of expected strength that should support that uptick, particularly Analog Devices' industrial business. The broker pointed to automated test equipment and aerospace and defense as notable contributors, and underscored the company’s business-to-business sales mix that emphasizes high-end analog solutions.
Stifel also reiterated that Analog Devices has implemented price increases in the 10% to 20% range, a factor the analyst sees as supporting the company’s pricing power and revenue profile.
Valuation notes
The $360 target is derived from a 14.0 times calendar year 2026 enterprise value-to-sales multiple, according to Stifel. Separate valuation data indicate that ADI is currently trading at relatively elevated multiples on some metrics, with a price-to-earnings ratio of 73.1 and a PEG ratio of 1.86. Those figures suggest to some observers that the stock's valuation is rich relative to its growth rate.
Analyst activity from other firms
Several other analyst teams have also adjusted their outlooks for Analog Devices in recent days, reflecting a broadly constructive view among sell-side firms. Cantor Fitzgerald raised its price target to $400 while maintaining an Overweight rating and cited expected strength across data center, automotive, defense and artificial intelligence markets. UBS also lifted its target to $400, pointing to strong growth in aerospace and defense. Barclays upgraded the stock to Overweight and moved its target to $375, noting the company’s industrial exposure and a correlation with Purchasing Managers’ Index readings. TD Cowen set a $355 target and emphasized Analog Devices’ industrial positioning and the potential benefits from automated test equipment and aerospace and defense end markets.
Board appointment
Analog Devices announced the appointment of Dr. Yoky Matsuoka to its Board of Directors, expanding the board to 11 members. Dr. Matsuoka, who is an executive officer at Panasonic Holdings, will serve on the company's Corporate Development Committee.
Market context and implications
Taken together, Stifel’s upgrade and the cluster of higher targets from other firms reflect growing analyst confidence in demand recovery across certain semiconductor end markets and in Analog Devices’ ability to leverage its high-end analog portfolio and business-to-business mix. The company’s recent price increases and the reported lean channel inventory are cited as structural supports for the revenue outlook through the next two quarters.
Note: This article reports analyst estimates, company metrics and recent analyst actions as stated by the respective research firms and corporate announcements.