Stock Analysis | Analog Devices Outlook - A Weak Technical Picture and Mixed Analyst Sentiment

Market Snapshot

Headline Takeaway: Analog Devices is showing a weak technical outlook and a mixed analyst consensus, suggesting caution for near-term traders.

News Highlights

Recent news highlights key themes affecting the semiconductor sector:

• McKinsey Report on Tariffs: A new analysis from McKinsey & Co. explores how U.S. tariff policies could reshape global chip supply chains, with potential long-term implications for semiconductor manufacturers like Analog Devices.
• Green Semiconductor Innovation: Article from Cadence outlines how companies are addressing the environmental costs of chip manufacturing, a growing concern in the sector.
• SOXX ETF Outflow: The U.S. Semiconductors ETF (SOXX) reported a $750 million outflow in May 2025, hinting at investor caution in the broader chip sector and possible ripple effects on stocks like ADI.

Analyst Views & Fundamentals

The analyst consensus is mixed, with 3.60 as the simple average rating and 3.02 as the performance-weighted score. These scores suggest relatively neutral to slightly positive expectations, though the ratings are not aligned—five Neutral, four Buy, and one Strong Buy among 10 institutions.

This contrasts with the current price trend, which is down 2.03% recently, suggesting a mismatch between analyst sentiment and market action.

Key fundamental factors and their internal diagnostic scores (0-10) are as follows:

• Net cash flow from operating activities per share (YoY growth rate %): -95.35% (score: 1)
• Net profit attributable to parent company shareholders / Net profit (%): 100.00% (score: 1)
• EV/EBIT: 136.02x (score: 2)
• Interest coverage ratio (EBIT / Interest expense %): 11.13x (score: 2)
• Net profit attributable to parent company shareholders (YoY growth rate %): 25.64% (score: 1)
• Net cash flow from operating activities (YoY growth rate %): -0.02% (score: 2)

Money-Flow Trends

Fund flows paint a generally positive picture for Analog Devices:

• Overall inflow ratio: 52.29% — indicating that more than half of the money flowing into the broader market is also entering this stock.
• Big-money (block) inflow ratio: 52.55% — showing institutional-level support.
• Small, medium, and extra-large inflow ratios are all positive, with the extra-large trend showing the strongest inflow at 53.37%.

Key Technical Signals

Technical indicators are bearish overall, with a low internal diagnostic score of 2.48 and a recommendation to "avoid it" due to weak momentum and a lack of bullish signals.

• RSI Overbought: Internal diagnostic score 1 — historically a bearish signal with negative average returns.
• MACD Death Cross: Internal diagnostic score 1.49 — a traditional bearish indicator with a win rate of only 36.36%.
• Bearish Engulfing: Internal diagnostic score 7.94 — surprisingly bullish, though it's the only positive signal in a weak trend.

Recent chart patterns:

• 2025-09-05: MACD Death Cross — a traditional bearish signal
• 2025-09-02: Ex-Dividend Date and Dividend Record Date — historically bearish for the stock
• 2025-08-28: Bearish Engulfing — a rare bullish candlestick pattern

Conclusion

With a weak technical outlook and bearish signals dominating, investors should avoid Analog Devices at this time. While the fundamentals and money flows suggest some underlying strength, the recent chart patterns and analyst dispersion indicate caution. If a pullback occurs in the coming weeks, it might be worth monitoring for a more favorable entry point, but for now, patience is key.