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Analog Devices (ADI) Falls More Steeply Than Broader Market: What Investors Need to Know

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The latest trading session saw Analog Devices (ADI - Free Report) ending at $230.70, denoting a -1.09% adjustment from its last day's close. The stock's change was less than the S&P 500's daily loss of 0.21%. At the same time, the Dow lost 0.14%, and the tech-heavy Nasdaq lost 0.05%.

Heading into today, shares of the semiconductor maker had gained 3.63% over the past month, lagging the Computer and Technology sector's gain of 9.62% and the S&P 500's gain of 5.94% in that time.

The upcoming earnings release of Analog Devices will be of great interest to investors. In that report, analysts expect Analog Devices to post earnings of $1.63 per share. This would mark a year-over-year decline of 18.91%. Meanwhile, the latest consensus estimate predicts the revenue to be $2.4 billion, indicating a 11.58% decrease compared to the same quarter of the previous year.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $6.34 per share and a revenue of $9.39 billion, representing changes of -37.17% and -23.69%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for Analog Devices. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.24% higher. Analog Devices is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that Analog Devices has a Forward P/E ratio of 36.77 right now. This valuation marks no noticeable deviation compared to its industry's average Forward P/E of 36.77.

It's also important to note that ADI currently trades at a PEG ratio of 3.87. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Semiconductor - Analog and Mixed industry currently had an average PEG ratio of 3.32 as of yesterday's close.

The Semiconductor - Analog and Mixed industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 198, which puts it in the bottom 22% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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