# Analog Devices (ADI)

Sector: Analog & mixed-signal semiconductors

| Field | Value |
|---|---|
| Price | $394.66 |
| Market cap | $191B |
| Intrinsic value source | Analysts |
| Data as of | 2026-11-10 |
| Next earnings | 2026-11-24 (confirmed) |

Analysts: Very bullish

Picks: Research only

Discount category: Close to intrinsic value

## In short

The market doubts that ADI's fast growth and record margins can last past the chip upturn, and steady growth with strong bookings and free cash flow into fiscal 2027 can close the gap.

## Themes and gap

- Themes: AI supplier (ai-supplier), China and geopolitics (china-geopolitics)
- Gap type: Can close (closable)
- Why: The Q4 fiscal 2026 report on November 24, 2026 and the Q1 fiscal 2027 report in February 2027 show whether growth and margins hold after the upturn.

## About

Analog Devices (ADI) makes analog, mixed-signal, power and digital signal processing chips. These chips measure and convert real-world signals, such as temperature, pressure, sound, light and motion, and they manage power in electronic systems. In Q3 fiscal 2026, Industrial was 49% of revenue, Automotive 25%, Communications 16% and Consumer 10%. Communications includes chips for data center equipment. ADI makes part of its chips in its own factories and uses outside foundries for the rest. Revenue was $11.0 billion in fiscal 2025 and $10.8 billion in the first nine months of fiscal 2026. Its fiscal year ends near October 31, and it is based in Wilmington, Massachusetts.

## Thesis

The market doubts that ADI's fast growth can last, because much of it looks like a cycle upturn. Revenue rose 40% to $4.02 billion in Q3 fiscal 2026, Communications revenue rose 84% and the adjusted operating margin reached 50.0%. Investors fear that part of this growth comes from a chip cycle upturn, and that revenue and margins fall back when industrial and automotive demand slows. ADI also borrowed more: it sold $3.0 billion of new notes in September 2026, and it agreed to buy Alif Semiconductor for $1.35 billion in cash. For the gap to close, three things must be true. Revenue must reach the Q4 fiscal 2026 outlook of $4.3 billion, plus or minus $100 million, with an adjusted operating margin near 52%, and fiscal 2027 must start with growth. Bookings in Industrial, Automotive and Communications must stay strong, which shows end demand and not only restocking. Free cash flow, $4.9 billion for the 12 months to August 1, 2026, must keep pace with revenue so that ADI can pay its dividend, buy back shares and lower debt. The Q4 fiscal 2026 report on November 24, 2026 is the next test, and the Q1 fiscal 2027 report in February 2027 is the one after it. If these checks pass, the gap can close over the next four to six quarters. The main reason it may not close is a turn in the chip cycle, which can cut revenue and margins quickly.

## Checkpoints

- Nov 24, 2026: Q4 fiscal 2026 results and Q1 fiscal 2027 outlook. Status: Pending. Watch: Revenue at or above the guided $4.3 billion, plus or minus $100 million, an adjusted operating margin near 52% and a Q1 fiscal 2027 outlook for growth pass; revenue below the range or an outlook for lower revenue fail.
- Dec 2026 (estimate): Alif Semiconductor purchase closes. Status: Pending. Watch: The purchase closes before the end of calendar 2026, as ADI expects, pass; a delay into 2027 or a regulatory block fail.

## Balance sheet

- Cash: $2.3B
- Debt: $9.2B
- Net debt: $6.9B
- Interest cover: 15×
- Undrawn credit line: $6.0B
- Debt due within 12 months: $2.3B
- Last debt due: 2054

ADI funds itself with senior notes and commercial paper. Debt principal was $9.22 billion at August 1, 2026: $1.0 billion of commercial paper and $8.22 billion of notes due from December 2026 to April 2054. $2.35 billion is due within 12 months: the commercial paper, $900 million of notes due December 2026 and $440 million due June 2027. Cash and cash equivalents were $2.17 billion and short-term investments $159 million. The five-year and the 364-day revolving credit facilities provide up to $6.0 billion, and they were undrawn; the 364-day facility expires on July 1, 2027. Interest cover is operating income of $3,990 million divided by interest expense of $263 million for the first nine months of fiscal 2026. After the quarter, in September 2026, ADI sold $3.0 billion of new notes due from 2029 to 2036, and it will pay $1.35 billion in cash for Alif Semiconductor. Free cash flow was $4.94 billion for the 12 months to August 1, 2026, and ADI returned $5.17 billion to shareholders in that period. The quarterly dividend is $1.10 per share.

As of 2026-08-01.

Sources:

- https://www.sec.gov/Archives/edgar/data/6281/000000628126000073/adi-20260801.htm
- https://www.sec.gov/Archives/edgar/data/6281/000000628126000072/adi3q26exhibit991earnings.htm
- https://www.sec.gov/Archives/edgar/data/6281/000119312526394361/d175690d8k.htm

## Dividends

- Dividend yield: 1.1% (last 12 months, at the current price)
- Paid per share, last 12 months: $4.29 (4 payments)
- Current annual rate: $4.40 ($1.10 x 4 a year)
- Payout ratio: 85% of the earnings of the last fiscal year (the year ended 2025-11-01)
- Latest ex-dividend date: 2026-09-01, $1.10 per share
- Growth over the last 5 years: 9.8% a year
- Growth over the last 10 years: 10.0% a year

Dividends per share by year: 2016: $1.68, 2017: $1.80, 2018: $1.92, 2019: $2.16, 2020: $2.48, 2021: $2.76, 2022: $3.04, 2023: $3.44, 2024: $3.68, 2025: $3.96.

Source: company filings and market data, read on 2026-11-09.

## Recent events

- 2026-10-22: ADI said that it will report Q4 fiscal 2026 results on Tuesday, November 24, 2026.
- 2026-09-17: ADI sold $3.0 billion of senior notes: $500 million of 5.100% notes due 2029, $500 million of 5.350% notes due 2031, $1.0 billion of 5.600% notes due 2033 and $1.0 billion of 5.750% notes due 2036.
- 2026-09-09: ADI agreed to buy Alif Semiconductor, a maker of AI microcontrollers and fusion processors for edge devices, for $1.35 billion in cash, plus up to $200 million of contingent payments. ADI expects the deal to close before the end of calendar 2026.
- 2026-08-19: ADI reported Q3 fiscal 2026 results. Revenue rose 40% to a record $4.02 billion, with Industrial up 53% and Communications up 84%. The adjusted operating margin was 50.0%, and adjusted EPS rose 68% to $3.45. Free cash flow was $4.9 billion for the 12 months to August 1, 2026. ADI guided Q4 revenue of $4.3 billion, plus or minus $100 million, and adjusted EPS of $3.86, plus or minus $0.15.
- 2026-07-29: ADI said that on June 23, 2026 it found unauthorized access to some of its systems. Its operations were not interrupted, and it engaged outside experts and law enforcement. It also said that it is assessing public reports about a separate cybersecurity matter.
- 2026-07-02: ADI signed a $3.0 billion 364-day revolving credit facility, in addition to its five-year facility.
- 2026-05-20: ADI reported Q2 fiscal 2026 results. Revenue rose 37% to $3.62 billion, the adjusted operating margin was 49.0% and adjusted EPS was $3.09. ADI said that bookings in Industrial, Automotive and Communications were at records.
- 2026-02-17: ADI raised its quarterly dividend 11% to $1.10 per share, from $0.99.
- 2025-11-25: ADI reported fiscal 2025 results. Revenue rose 17% to $11.0 billion, adjusted EPS rose 22% to $7.79 and free cash flow was $4.3 billion.

## Latest news and filings

- Last earnings: 2026-08-19 (8-K: https://www.sec.gov/Archives/edgar/data/6281/000000628126000072/)
- Next earnings: 2026-11-24 (confirmed by the company)

| Filed | Form | Headline | Period end | XBRL document | Link |
| --- | --- | --- | --- | --- | --- |
| 2026-09-17 | 8-K | New material agreement |  |  | https://www.sec.gov/Archives/edgar/data/6281/000119312526394361/d175690d8k.htm |
| 2026-09-09 | 8-K | Investor disclosure |  |  | https://www.sec.gov/Archives/edgar/data/6281/000119312526385938/d924057d8k.htm |
| 2026-08-19 | 10-Q | Quarterly report for the period ended Aug 1, 2026 | 2026-08-01 | adi-20260801 | https://www.sec.gov/Archives/edgar/data/6281/000000628126000073/adi-20260801.htm |
| 2026-08-19 | 8-K | Earnings release |  | adi-20260819 | https://www.sec.gov/Archives/edgar/data/6281/000000628126000072/adi-20260819.htm |
| 2026-07-29 | 8-K | Other company news |  |  | https://www.sec.gov/Archives/edgar/data/6281/000119312526324223/d158253d8k.htm |
| 2026-07-02 | 8-K | New material agreement and New debt or financial obligation |  |  | https://www.sec.gov/Archives/edgar/data/6281/000119312526294488/d112344d8k.htm |
| 2026-05-20 | 10-Q | Quarterly report for the period ended May 2, 2026 | 2026-05-02 | adi-20260502 | https://www.sec.gov/Archives/edgar/data/6281/000000628126000052/adi-20260502.htm |
| 2026-05-20 | 8-K | Earnings release |  | adi-20260520 | https://www.sec.gov/Archives/edgar/data/6281/000000628126000050/adi-20260520.htm |
| 2026-05-19 | 8-K | Investor disclosure |  | adi-20260519 | https://www.sec.gov/Archives/edgar/data/6281/000000628126000048/adi-20260519.htm |
| 2026-03-12 | 8-K | Change of directors or officers and Shareholder vote results |  | adi-20260311 | https://www.sec.gov/Archives/edgar/data/6281/000000628126000022/adi-20260311.htm |

Every filing on SEC EDGAR (CIK 6281): https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000006281&type=&dateb=&owner=include&count=40

## Risks

- High: Chip demand moves in cycles. Revenue rose 40% in Q3 fiscal 2026, and ADI also built its own inventory to support the higher demand. If customers order less in a downturn, revenue and margins can fall quickly.
- Medium: Automotive was 25% of revenue in Q3 fiscal 2026 and grew only 16%. Weak car production or electric vehicle demand can slow this market.
- Medium: ADI sells to customers in China. Export controls, tariffs or more competition from Chinese analog chip makers can lower sales and margins.
- Low: ADI found unauthorized access to some systems in June 2026. Its operations were not interrupted, but a cybersecurity incident can cause costs, legal claims or a loss of customer trust.

## Links

- Page: https://picks.utilarium.app/company/ADI/
- History of changes: https://picks.utilarium.app/company/ADI/history/
- JSON with full history: https://picks.utilarium.app/data/company/ADI.json

> Picks is a personal record of stock picks. It gives general opinions about stocks, including a "Top pick" label. They are not tailored to your needs, goals or risk tolerance. Kevin is not a registered adviser and relies on the general-advice exemption in Canadian securities law (NI 31-103 s.8.25). Do your own research, or ask a registered adviser. Kevin may hold any stock on this site. Prices, intrinsic values and ratings can be delayed or wrong; check the original source. Full disclaimer: /disclaimer/.