Here's What Analysts Are Forecasting For Analog Devices, Inc. (NASDAQ:ADI) After Its Yearly Results

Analog Devices, Inc. (NASDAQ:ADI) last week reported its latest full-year results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Analog Devices reported US$9.4b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$3.28 beat expectations, being 3.9% higher than what the analysts expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Analog Devices

After the latest results, the 26 analysts covering Analog Devices are now predicting revenues of US$10.2b in 2025. If met, this would reflect a modest 7.9% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to jump 23% to US$4.05. Before this earnings report, the analysts had been forecasting revenues of US$10.3b and earnings per share (EPS) of US$4.79 in 2025. So there's definitely been a decline in sentiment after the latest results, noting the substantial drop in new EPS forecasts.

The consensus price target held steady at US$252, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Analog Devices analyst has a price target of US$295 per share, while the most pessimistic values it at US$212. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Analog Devices' revenue growth is expected to slow, with the forecast 7.9% annualised growth rate until the end of 2025 being well below the historical 16% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 20% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Analog Devices.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Analog Devices going out to 2027, and you can see them free on our platform here.

It is also worth noting that we have found 2 warning signs for Analog Devices that you need to take into consideration.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.