Analog Devices Inc

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ADI : NASDAQ : Technology
$73.14 | %
Today's Range: 72.49 - 74.82
Avg. Daily Volume: 2775400.0
12/09/16 - 4:00 PM ET

Financial Analysis


ANALOG DEVICES's gross profit margin for the fourth quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company has grown its sales and net income during the past quarter when compared with the same quarter a year ago, and although its growth in net income has outpaced the industry average, its revenue growth has not. ANALOG DEVICES is extremely liquid. Currently, the Quick Ratio is 5.79 which clearly shows the ability to cover any short-term cash needs. ADI managed to increase the liquidity from the same period a year ago, despite already having very strong liquidity to begin with. This would indicate improved cash flow.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 1.82% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

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Income Statement Q4 FY16 Q4 FY15
Net Sales ($mil)1003.62978.72
EBITDA ($mil)436.73402.38
EBIT ($mil)383.07351.39
Net Income ($mil)296.1696.31


Balance Sheet Q4 FY16 Q4 FY15
Cash & Equiv. ($mil)4055.793028.93
Total Assets ($mil)7970.287062.18
Total Debt ($mil)1732.18873.34
Equity ($mil)5165.625072.96


Profitability Q4 FY16 Q4 FY15
Gross Profit Margin70.1969.15
EBITDA Margin43.5141.11
Operating Margin38.1735.9
Sales Turnover0.430.49
Return on Assets10.819.86
Return on Equity16.6813.73
Debt Q4 FY16 Q4 FY15
Current Ratio6.353.66
Debt/Capital0.250.15
Interest Expense25.16.74
Interest Coverage15.2652.14


Share Data Q4 FY16 Q4 FY15
Shares outstanding (mil)308.17312.06
Div / share0.420.4
EPS0.950.3
Book value / share16.7616.26
Institutional Own % n/a n/a
Avg Daily Volume2778138.02386142.0

Valuation


BUY. ANALOG DEVICES's P/E ratio indicates a discount compared to an average of 29.52 for the Semiconductors & Semiconductor Equipment industry and a value on par with the S&P 500 average of 25.22. For additional comparison, its price-to-book ratio of 4.18 indicates a premium versus the S&P 500 average of 2.79 and a premium versus the industry average of 4.12. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
ADI 25.40 Peers 29.52   ADI 16.87 Peers 17.35

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

ADI is trading at a discount to its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

ADI is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
ADI 19.10 Peers 18.04   ADI 1.11 Peers 2.45

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

ADI is trading at a premium to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

ADI trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
ADI 4.18 Peers 4.12   ADI 25.45 Peers 21.99

Average. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

ADI is trading at a valuation on par with its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

ADI is expected to have an earnings growth rate that exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
ADI 6.31 Peers 4.40   ADI -0.40 Peers 10.60

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

ADI is trading at a significant premium to its industry.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

ADI significantly trails its peers on the basis of sales growth

 

 

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