JPMorgan Reaffirms $300 Price Target for Analog Devices After Strong Q2

On May 22, JPMorgan reaffirmed its $300 price target and Overweight rating for Analog Devices Inc. (NASDAQ:ADI) after the company reported impressive April-quarter results.

With a book-to-bill ratio greater than one and a quarter-over-quarter acceleration, Analog Devices Inc. (NASDAQ:ADI), a major player in the semiconductor and semiconductor equipment industry, has a broad-based bookings strength across all end markets and geographies.

The company noted a number of growth drivers for its performance, including AI-related markets, which are expected to possibly expand by 20–25% in FY25.

The July quarter is expected to see a 70% increase in gross margins, with the possibility of a 100–200 basis point improvement as cyclical conditions improve and utilization rates rise. While automotive revenue is anticipated to fall due to the demand pull-forward from the previous quarter, revenue for the upcoming quarter is predicted to increase by 4% on a quarterly basis, driven primarily by the consumer and industrial segments.

That said, JPMorgan predicts below-seasonal trends and a weaker macro demand environment in the year’s second half. As a result, the company lowered its CY25 estimates while starting its CY26 estimates.

While we acknowledge the potential of ADI to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk.  If you are looking for an AI stock that is more promising than ADI and that has 100x upside potential, check out our report about the cheapest AI stock.

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Disclosure: None.