Analogue Devices Inc. (NASDAQ:ADI) is projected to be bullish based on strong momentum. The stock is trading at a valuation of $164. The trended support level for the stock is $154. Our analysis shows that the stock could remain bullish with a price target between $190 and $200.
Analogue Devices is characterized by low risk. The 52-week range for the stock is between $143 and $191. The company is projected to maintain the same price performance. The Achilles heel is the company’s weak financial performance. The ROE is low at only 6.64%. The EPS is projected at $3.56. With a dividend payout of $3.04, it means that the stock pays out almost all of its earnings to dividends. The projected EPS growth of 12.25% may not excite the markets.
The only reason for investing in Analogue Devices would be the momentum. Zacks Research gives A-rating for momentum style. This signals a strong belief that the stock will perform as it has in the past.
Analogue Devices is on a confirmed upward trend
Source – TradingView
Our analysis indicates that Analogue Devices is trading at the lower bound of the trend channel. As a momentum stock, the price could gain gradually towards the upper limit of the regression channel. This means that the stock could gain towards a target price of $200. The pattern in the recent weeks indicates the possibility that the stock will maintain the trend. The target is expected to peak by the next earnings date in August.
Summary
Analogue Devices is a recommended buy for momentum or trend investors. From the current $164, the stock is likely to find a new target between $190 and $200. The price target is expected to be met by August.
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