An ascending triangle pattern has formed in the chart of Analog Devices, Inc. (ADI). This is a bullish pattern and if the resistance level is broken, a breakout could occur…
Analog Devices, Inc. (ADI) is a leading analog, mixed signal, and digital signal processing chipmaker. The company has a significant market share lead in converter chips, which are used to translate analog signals to digital and vice versa.
The company is benefiting from strength in the electric vehicle space driven by its Battery Management System (BMS) solutions. Plus, the rising adoption of advanced radio systems in 5G is driving growth in the firm’s communication segment. Management is optimistic about growth opportunities in 5G.
ADI has a current ratio of 1.6, which means it has more than enough liquidity to handle short-term obligations. The company is also quite profitable with a net profit margin of 24%. In its most recent reported quarter, earnings were up 39.8% year over year, while revenue rose 20%.
Its stock is a bit overvalued with a trailing P/E of 41.99 and a forward P/E of 25.51. The stock has been trending up since September, but has shown mixed momentum for the year.
Take a look at the 1-year chart of ADI below with the added notations…
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