Analog Devices Q1 Earnings: Revenue Decline Offset by Automotive Growth and Dividend Hike

Analog Devices, Inc ADI stock traded higher Wednesday after it reported first-quarter fiscal 2024 results.

The company clocked a revenue decline of 22.7% year-on-year to $2.513 billion, beating the consensus of $2.499 billion. Adjusted EPS of $1.73 beat the consensus of $1.71.

Analog Devices’ Industrial revenue declined by 31% Y/Y to $1.2 billion. Automotive revenue increased 9% Y/Y to $739.2 million.

Communications revenue declined by 37% to $302.6 million, and Consumer revenue decreased by 22% to $274.1 million.

The adjusted gross margin declined by 460 bps to 69.0% as lower revenue weighed on the profits. The adjusted operating margin fell by 910 bps to 42.0%.

Analog Devices held $1.30 billion in cash and equivalents, generating $1.14 billion in operating cash flow.

Dividend: The board raised the quarterly dividend by 7% to $0.92 per share, marking the twentieth consecutive year of increase.

Vincent Roche, CEO and Chair, said, “Consistent with our prior view, we expect customer inventory rationalization to largely subside in our second quarter and thus enter the second half in a more favorable business backdrop.”

Outlook: Analog Devices expects second-quarter revenue of $2.10 billion, +/- $100 million, below the consensus of $2.36 billion. The company projects adjusted EPS of $1.26, +/-$0.10, below the consensus of $1.57.

ADI Stock Prediction For 2024

Equity research can be a valuable source of information for learning about a company's fundamentals. Analysts create financial models based on the fundamentals and expected future earnings of a company to arrive at a price target and recommendation for the stock.

Shares of Analog Devices ADI have an average 1-year price target of $201.0, representing an expected upside of 4.04%.

Because of differences in assumptions, analysts can arrive at very different price targets and recommendations. No analysts have bearish recommendations on Analog Devices, while No analysts have bullish ratings. The street high price target from Cantor Fitzgerald is $205.0, while the street low from Barclays is $185.0.

Price Action: ADI shares traded higher by 1.66% at $192.49 on the last check Wednesday.

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