Analog Devices (ADI) Stock Falling Ahead of Earnings Results - TheStreet

NEW YORK (TheStreet) -- Shares of Analog Devices (ADI) - Get Report are down by 3.53% to $57.32 in early afternoon trading on Monday, one day before the semiconductor company releases its fiscal 2015 fourth quarter earnings report.

The company will announce its latest financial results before the market open on Tuesday morning.

Analysts are expecting Analog Devices to post a year over year rise in both its earnings per share and revenue results for the most recent quarter.

The company has been forecast, by analysts surveyed by Thomson Reuters, to report earnings of 83 cents per share on revenue of $909.9 million for the three month period ended in October.

Last year, Analog Device's adjusted non-GAAP earnings came in at 69 cents per share on revenue of $814 million.

Analog Devices is a Norwood, MA-based designer, manufacturer and marketer of high performance analog, mixed signal and digital signal integrated circuits.

Separately, TheStreet Ratings team rates ANALOG DEVICES as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:

We rate ANALOG DEVICES (ADI) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, increase in net income and growth in earnings per share. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 10.9%. Since the same quarter one year prior, revenues rose by 18.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • ADI's debt-to-equity ratio is very low at 0.17 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 3.36, which clearly demonstrates the ability to cover short-term cash needs.
  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 19.9% when compared to the same quarter one year prior, going from $180.61 million to $216.48 million.
  • ANALOG DEVICES has improved earnings per share by 19.3% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ANALOG DEVICES reported lower earnings of $1.98 versus $2.14 in the prior year. This year, the market expects an improvement in earnings ($2.96 versus $1.98).
  • You can view the full analysis from the report here: ADI

Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.