Analog Devices (ADI) Stock Margins Hit 50% As Cash Engine Strengthens

BMO Capital Markets initiated coverage of semiconductor and quantum computing sectors, favoring AI-exposed and analog chipmakers. Nvidia (top pick) received an Outperform rating and $340 target, with expected revenue growth of 84% and 50% in FY27 and 2028. Other picks include Broadcom, Micron, AMD, Marvell, Semtech, Analog Devices, Microchip, and Impinj. BMO predicts a memory market supercycle and AI-driven capex growth.

Analog Devices reported a record $4 billion revenue in Q3 2026, driven by data center and industrial growth. Management expects Q4 revenue of $4.3 billion and a 74% gross margin. The company anticipates long-term double-digit growth due to AI demand and completed acquisitions like Empower Semiconductor.

Analog Devices (ADI) reported Q3 growth across industrial, automotive, and communications sectors, with data centers driving 80% of communications revenue. The company expects optical circuit switching revenue to double this year and in 2027, and sees strong demand for power management technologies. ADI forecasts Q4 revenue of $4.3B and EPS of $3.86, with a focus on data-center and AI-driven growth through 2030.

Bernstein upgraded Analog Devices (ADI) to Outperform, raising its price target to $465. ADI reported Q3 revenue of $4.022B, beating estimates, with strong automotive and industrial segments. Q4 guidance also exceeded expectations, with revenue forecast at $4.3B and EPS at $3.86. The company expects margin expansion, driven by revenue growth and product mix. Shares gained 1% in premarket trading.

Analog Devices reported Q3 fiscal 2026 earnings of $3.45 per share, beating estimates by 3.6%. Revenue rose 40% year-over-year to $4.02 billion. The company's segments saw varied growth, with the highest in Communications (84%). ADI expects Q4 revenue of $4.3 billion and adjusted earnings of $3.86 per share, above consensus estimates.

Needham raised its price target for Analog Devices (NASDAQ:ADI) to $450 from $440, citing strong quarterly results and guidance. The company's revenue and earnings beat forecasts, with gross margins expected to expand. Bernstein also upgraded ADI to Outperform with a $465 target. ADI's stock has surged 54% over the past year.