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

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The most recent trading session ended with Analog Devices (ADI - Free Report) standing at $224.19, reflecting a -0.57% shift from the previouse trading day's closing. The stock's change was less than the S&P 500's daily loss of 0.28%. At the same time, the Dow lost 0.61%, and the tech-heavy Nasdaq lost 0.33%.

The the stock of semiconductor maker has fallen by 1.2% in the past month, lagging the Computer and Technology sector's gain of 2.1% and the S&P 500's gain of 0.41%.

The investment community will be paying close attention to the earnings performance of Analog Devices in its upcoming release. The company is slated to reveal its earnings on November 26, 2024. The company's upcoming EPS is projected at $1.63, signifying a 18.91% drop compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $2.4 billion, showing a 11.58% drop compared to the year-ago quarter.

Investors should also note any recent changes to analyst estimates for Analog Devices. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable 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. Within the past 30 days, our consensus EPS projection has moved 0.01% lower. Analog Devices is holding a Zacks Rank of #3 (Hold) right now.

In the context of valuation, Analog Devices is at present trading with a Forward P/E ratio of 30.04. For comparison, its industry has an average Forward P/E of 34.77, which means Analog Devices is trading at a discount to the group.

It's also important to note that ADI currently trades at a PEG ratio of 3.16. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The average PEG ratio for the Semiconductor - Analog and Mixed industry stood at 3.25 at the close of the market yesterday.

The Semiconductor - Analog and Mixed industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 153, placing it within the bottom 40% of over 250 industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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