Episode Details

Analog Devices Q1 2026 earnings breakdown - conversational walkthrough with a price-aware verdict and Wall Street consensus comparison. THE CALL: HOLD (3/5 conviction, MODERATE) - CURRENT @ $383.36 - HOLD - BUY below $340.00 with $295.00 stop - AVOID above $430.00 TRIGGER: Q3 FY26 revenue beat AND raised FY26 sales guide above 32 percent, OR a pullback to the 200-day moving average near $295 WINDOW: Through Q4 FY2026 earnings (late November 2026) TRACKER: charged-alpha.com/calls/ADI WALL STREET CONSENSUS - Ratings: 0 Strong Buy / 43 Buy / 11 Hold / 0 Sell / 0 Strong Sell - BUY - Median 12-month price target: $450.00 (range $280 - $515) - Charged Alpha vs consensus: MORE CAUTIOUS THESIS Analog Devices is the highest-quality cyclical recovery story in semiconductors - best-in-class margins, broad industrial exposure, restocking tailwind extending into fiscal 2027. Bull lever: Industrial bookings exceeding billings for the second straight quarter - when this metric inflects positive in analog, it historically signals six to eight quarters of continued upside. Operating margin still has room to 40-plus percent based on cycle peaks. Key risk: Valuation. At 31x forward EPS and 13x EV-to-sales, the stock is priced for a flawless cycle. A single quarter of softer-than-expected guidance or any geopolitical shock to industrial automation demand would compress the multiple meaningfully. QUALITY CHECK - Management quality grade: A (Vincent Roche team has navigated the worst analog downcycle in a decade with discipline - held capex flat, maintained the dividend, and timed inventory drawdowns ahead of peers. Maxim integration is now a clean tailwind.) - Earnings quality grade: B+ (Earnings backed by cash conversion (FCF 734M vs NI 1,176M = 62 percent conversion, normal for a working-capital-up quarter). GAAP-to-adj gap is the main concern: $0.68 of adjustments per share is wider than peers. SBC dilution moderate. Inventory build matches sales growth.) CHAPTERS 0:00 Hook 0:49 The Print 1:59 The Trend 2:43 The Segments 3:34 The FCF Bridge 4:18 Guidance & The Narrative Diff 5:12 Peer Dot-Plot 5:59 Management & Earnings Quality 6:50 S8_Call KEY METRICS - Q2 FY2026 - Revenue: $3,623M (+37.2 pct YoY, beat 3.1 pct) - Adj EPS: $3.09 (vs $2.89 est, +6.9 pct beat) - GAAP EPS: $2.41 (GAAP-adj gap $0.68/share) - Gross margin: 67.3 pct - Operating margin: 38.1 pct GAAP (+1,240 bps YoY) -- company record - Net income: $1,176M (+106.5 pct YoY) - Free cash flow: $734M (20.3 pct margin) SEGMENT BREAKDOWN - Industrial (47 pct): +42 pct YoY -- restocking engine - Automotive (30 pct): +35 pct YoY -- ADAS/EV content gains - Communications (13 pct): +38 pct YoY -- 5G + data center optical - Consumer (10 pct): +30 pct YoY -- stable GUIDANCE - Q3 FY2026 - Q3 revenue midpoint $3.85B vs Street $3.86B (in-line) - FY26 sales growth 28-32 pct vs Street 25 pct (raised) - FY26 EPS growth 50-60 pct (vs Street 45 pct) NARRATIVE DIFF - Q1 FY26: "continued sequential improvement as channel inventory normalizes" - Q2 FY26: "industrial bookings exceed billings for second consecutive quarter -- restocking with fiscal 2027 visibility" - Tone shift: cautiously-optimistic to confidently-bullish DATA SOURCES - FMP (financialmodelingprep.com) - Analog Devices Q2 FY2026 Earnings Release (2026-05-20) - Q2 FY2026 Earnings Call DISCLAIMER This is for informational and entertainment purposes only. Not financial advice. Charged Alpha does not have a position in ADI. Do your own research before any investment decision. #ADI #AnalogDevices #semiconductor #earnings #investing #ChargedAlpha