Analog Devices (ADI) is On Track to Challenge Texas Instrucments (TXN) - Stifel

Stifel analyst Tore Svanberg reiterated a Buy rating and $175.00 price target on Analog Devices (NASDAQ: ADI) after the company's CES presentations indicate that data has become the “new oil”. Management believes that sensing technology down to the molecular scale can draw increasingly helpful, data-rich pictures of the world in which we live. The fusion of technology with multiple application areas such as Industrial, Automotive and Healthcare will continue to yield real economic benefits, especially as the usefulness of technology is amplified by increasingly high performance sensing, connectivity and signal processing capabilities enabled by analog/mixed-signal and RF/wireless technology.

The analyst stated "With ADI’s recent announcement to acquire Maxim Integrated Products (NASDAQ: MXIM), we believe the combination of both companies, along with HITT and LLTC instantly creates a formidable high performance analog/mixed-signal powerhouse that positions the company within striking distance of the current industry heavyweight, Texas Instruments (NASDAQ: TXN). Indeed, we note the highly strategic nature of the deal, raising the profile of ADI’s long-term revenue opportunities with projected revenues of ~$8.3bn in CY21 vs ~$10bn analog revenue for TXN. Taken together with ADI’s successful experience with its prior two acquisitions (HITT and LLTC), we believe the deal could prove to be nicely accretive in the next 18 months, following in line with management’s expectations to double HITT revenue to $500mn in 6 years since closing and goal to double LLTC growth rate within a similar timeframe".

For an analyst ratings summary and ratings history on Analog Devices click here. For more ratings news on Analog Devices click here.

Shares of Analog Devices closed at $159.83 yesterday.

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