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Comparing Analog Devices With Industry Competitors In Semiconductors & Semiconductor Equipment Industry

Published Dec 07, 2023 16:00 Updated Dec 07, 2023 18:41
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© Reuters. Comparing Analog Devices With Industry Competitors In Semiconductors & Semiconductor Equipment Industry
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Benzinga - by Benzinga Insights, Benzinga Staff Writer.

In today's fast-paced and competitive business landscape, it is essential for investors and industry enthusiasts to thoroughly analyze companies before making investment decisions. In this article, we will conduct a comprehensive industry comparison, evaluating Analog Devices (NASDAQ:ADI) against its key competitors in the Semiconductors & Semiconductor Equipment industry. By examining key financial metrics, market position, and growth prospects, we aim to provide valuable insights for investors and shed light on company's performance within the industry.

Analog Devices Background Analog Devices is a leading analog, mixed signal, and digital signal processing chipmaker. The firm has a significant market share lead in converter chips, which are used to translate analog signals to digital and vice versa. The company serves tens of thousands of customers, and more than half of its chip sales are made to industrial and automotive end markets. Analog Devices' chips are also incorporated into wireless infrastructure equipment.

CompanyP/EP/BP/SROEEBITDA (in billions)Gross Profit (in billions)Revenue Growth
Analog Devices Inc 27.57 2.52 7.42 1.39% $1.18 $1.65 -16.36%
NVIDIA Corp 60.03 33.79 25.25 30.42% $10.96 $13.4 205.51%
Taiwan Semiconductor Manufacturing Co Ltd 18.36 4.78 7.40 6.46% $392.33 $296.64 -10.83%
Broadcom Inc 27.80 21.34 10.65 14.98% $4.91 $6.16 4.87%
Advanced Micro Devices Inc 1061.91 3.43 8.58 0.54% $1.13 $2.75 4.22%
Qualcomm Inc 19.93 6.70 4.09 7.05% $2.06 $4.75 -24.26%
Texas Instruments Inc 20.21 8.52 7.89 10.44% $2.34 $2.81 -13.53%
ARM Holdings PLC 347.78 13.12 22.06 -2.45% $-0.12 $0.76 27.94%
Microchip Technology Inc 18.35 6.50 5.17 9.66% $1.1 $1.53 8.74%
STMicroelectronics NV 10.23 2.78 2.57 7.28% $1.69 $2.11 2.55%
ON Semiconductor Corp 14.81 4.23 3.96 8.05% $0.87 $1.03 -0.54%
GLOBALFOUNDRIES Inc 20.11 2.62 3.72 2.34% $0.64 $0.53 -10.7%
United Microelectronics Corp 8.74 1.74 2.58 4.72% $29.0 $20.46 -24.3%
ASE Technology Holding Co Ltd 15.90 1.97 0.97 3.06% $28.07 $24.92 -18.27%
Skyworks Solutions Inc 16.37 2.64 3.37 4.09% $0.4 $0.48 -13.37%
First Solar Inc 32.88 2.46 4.92 4.35% $0.37 $0.38 27.37%
Lattice Semiconductor Corp 39.30 13.17 11.26 8.96% $0.07 $0.13 11.4%
Universal Display Corp 40.08 5.92 14 3.77% $0.06 $0.11 -12.13%
Rambus Inc 24.47 7.21 15.33 10.86% $0.12 $0.08 -6.19%
MACOM Technology Solutions Holdings Inc 65.77 6.39 9.28 2.63% $0.05 $0.09 -15.59%
Allegro Microsystems Inc 20.25 4.62 4.78 6.18% $0.09 $0.16 15.92%
Average 94.16 7.7 8.39 7.17% $23.81 $18.96 7.94%
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.dividend-frequency { font-size: 12px; color: #6c757d; } By conducting a comprehensive analysis of Analog Devices, the following trends become evident:

  • A Price to Earnings ratio of 27.57 significantly below the industry average by 0.29x suggests undervaluation. This can make the stock appealing for those seeking growth.

  • The current Price to Book ratio of 2.52, which is 0.33x the industry average, is substantially lower than the industry average, indicating potential undervaluation.

  • Based on its sales performance, the stock could be deemed undervalued with a Price to Sales ratio of 7.42, which is 0.88x the industry average.

  • The Return on Equity (ROE) of 1.39% is 5.78% below the industry average, suggesting potential inefficiency in utilizing equity to generate profits.

  • The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $1.18 Billion is 0.05x below the industry average, suggesting potential lower profitability or financial challenges.

  • Compared to its industry, the company has lower gross profit of $1.65 Billion, which indicates 0.09x below the industry average, potentially indicating lower revenue after accounting for production costs.

  • With a revenue growth of -16.36%, which is much lower than the industry average of 7.94%, the company is experiencing a notable slowdown in sales expansion.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio gauges the extent to which a company has financed its operations through debt relative to equity.

Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.

When examining Analog Devices in comparison to its top 4 peers with respect to the Debt-to-Equity ratio, the following information becomes apparent:

  • Analog Devices exhibits a stronger financial position compared to its top 4 peers in the sector, as indicated by its lower debt-to-equity ratio of 0.2.

  • This suggests that the company has a more favorable balance between debt and equity, which can be seen as a positive aspect for investors.

Key Takeaways Analog Devices has a low PE ratio, indicating that its stock price is relatively low compared to its earnings. The low PB ratio suggests that the company's stock is undervalued based on its book value. The low PS ratio indicates that the stock is trading at a low price relative to its sales. On the other hand, Analog Devices has a low ROE, indicating that it is not generating high returns on its shareholders' equity. The low EBITDA suggests that the company's operating profitability is relatively low. The low gross profit indicates that Analog Devices has a lower margin compared to its peers. Lastly, the low revenue growth suggests that the company's sales are not growing at a significant rate compared to its industry peers.

This article was generated by Benzinga's automated content engine and reviewed by an editor.

© 2023 Benzinga does not provide investment advice. All rights reserved.

Read the original article on Benzinga

Comparing Analog Devices With Industry Competitors In Semiconductors & Semiconductor Equipment Industry

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