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Analog Devices (ADI) to Report Q4 Earnings: What's in Store?

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Analog Devices, Inc. (ADI - Free Report) is slated to report fourth-quarter fiscal 2020 results on Nov 24, before the opening bell. In the last reported quarter, it delivered an earnings surprise of 2.3%.

The stock outperformed earnings estimates thrice and missed once in the last four quarters, with the average surprise being 1.6%.

Trend in Estimate Revision

For the fiscal fourth quarter, the Zacks Consensus Estimate for earnings has remained stable at $1.32 per share over the past 30 days. This indicates growth of 10.9% from the year-ago reported figure.

The consensus mark for revenues is pegged at $1.44 billion, implying growth of 0.01% from the year-ago reported figure.

Let’s see how things have shaped up for this announcement.

Analog Devices, Inc. Price and EPS Surprise

Analog Devices, Inc. Price and EPS Surprise

Analog Devices, Inc. price-eps-surprise | Analog Devices, Inc. Quote

Factors to Note

Analog Devices’ communications market is anticipated to have performed well in the quarter to be reported, driven by strength of the wireless segment. The accelerated build out of TD-LTE in China, continuing 5G network densification activities in the United States and deployments in Europe are expected to have benefited the communications segment.

Nevertheless, strength in the company’s industrial segment and increased focus on innovation and operational execution are expected to reflect on the upcoming results. Also, the automotive electronics market is likely to have gained from consumer demand for added technology and features in new vehicles, along with the transition to hybrid and electric vehicles.

During the quarter, it unveiled a new wireless battery management system, thereby expanding reach in the auto space. The new system provides automotive manufacturers increased flexibility to scale their electric vehicle fleets into volume production across a wide range of vehicle classes.

The Zacks Consensus Estimate for communications revenues is pegged at $310 million, indicating growth of 19.2% year over year. The consensus estimate for revenues from the automotive market is pegged at $178 million, indicating a decline of 21.2% year over year. The consensus mark for revenues from the consumer market is pegged at $160 million, indicating a decline of 24.9% year over year. The same for revenues from the industrial market is pegged at $792 million, indicating growth of 6.5% year over year.

However, the global coronavirus-led economic crisis might have impacted the company’s fiscal fourth-quarter sales to some extent.

Also, softness in the consumer market might have been a major concern.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for Analog Devices this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case here as you will see below.

Earnings ESP: The company has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Currently, Analog Devices has a Zacks Rank #4 (Sell).

Stocks That Warrant a Look

Here are a few stocks worth considering, as our model shows that these have the right combination of elements to deliver an earnings beat in the upcoming releases.

Target Corporation (TGT - Free Report) has an Earnings ESP of +5.55% and holds a Zacks Rank of 2, at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Momo Inc. (MOMO - Free Report) has an Earnings ESP of +5.41% and carries a Zacks Rank of 3, currently.

DocuSign (DOCU - Free Report) has an Earnings ESP of +4.35% and currently holds a Zacks Rank of 3.

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In-Depth Zacks Research for the Tickers Above

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