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., 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.
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