TD Cowen has increased its price target for Analog Devices Inc. to $400 from $355 and retained a Buy rating on the shares. The stock is trading at $343.54, approximately 3.3% below its 52-week peak of $355.36.
In its update, TD Cowen highlighted several drivers that supported the higher target. The firm pointed to marked strength within Analog Devices’ datacenter-related segments and its aerospace and defense business. The research note also emphasized an improvement in gross margin, which the company reported at 62.84%.
TD Cowen characterized the company’s performance as benefiting not only from the broader cyclical recovery in the analog semiconductor market but also from content-related dynamics that are adding incremental upside to revenue per end market.
Valuation metrics show a high price-to-earnings ratio of 61.71, indicating that investors are pricing in considerable future growth for the stock. At the same time, the company displayed relative softness in its industrial and automotive end markets during the quarter, a contrast to the stronger datacenter and defense results.
On forward-looking measures, TD Cowen said the company’s guidance and booking trends point to positive momentum heading into fiscal year 2026.
Broader analyst responses
Analog Devices’ recent financial results and raised guidance prompted additional analyst updates from multiple firms.
- Needham upgraded its rating on the stock to Buy from Hold and set a price target of $400, citing the company’s strong results.
- KeyBanc raised its price target to $430, noting particular strength in the Communications and Consumer segments, including data center optical and wearables.
- Truist Securities increased its price target to $364 while keeping a Hold rating, and pointed to cyclical strength in the semiconductor business.
- Piper Sandler retained a Neutral rating but lifted its target to $360, emphasizing growth tied to AI and datacenter demand.
- Bernstein moved its price target to $375, referencing the company’s strong year-to-date performance while also flagging valuation concerns.
Together, these adjustments reflect a broadly constructive view from analysts following the company’s recent quarterly beat and upbeat near-term guidance. The updates show consensus optimism about the company’s revenue drivers, particularly in datacenter-related markets, while at least some analysts remain attentive to valuation and segment variability.
Context and takeaway
Analog Devices is trading close to its yearly high, supported by accelerated demand in its datacenter and defense businesses and an elevated gross margin figure. Multiple brokerages have responded to the company’s recent results with higher targets and revised ratings, a clear signal of improved sentiment among sell-side analysts. That said, pockets of weakness in industrial and automotive end markets and a high P/E ratio underline areas investors and analysts continue to watch.