• If you have been wondering whether Analog Devices at around US$408 per share still offers value, it helps to step back and look at what the recent price action and fundamentals might be saying.
• The stock shows returns of 1.6% over the last week, 24.8% over the last month, 49.2% year to date and 104.5% over the last year. This can change how investors think about both upside potential and risk.
• Recent coverage has focused on Analog Devices as one of the larger US semiconductor stocks, with attention on its role in areas like industrial and communications chips. These areas often frame how investors think about its long term demand profile. Commentary has also highlighted how the wider semiconductor sector remains a key focus for investors looking at long term themes, which can influence sentiment toward Analog Devices when capital flows into or out of the sector.
• Despite this strong share price performance, Simply Wall St currently assigns Analog Devices a value score of 0 out of 6. Next you will see how different valuation methods assess the stock today, followed by a more complete way to think about valuation that goes beyond a single model.

Analog Devices scores just 0/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Analog Devices Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow model estimates what a stock could be worth today by projecting the company’s future cash flows and discounting them back to the present using a required rate of return.

For Analog Devices, the model used is a 2 Stage Free Cash Flow to Equity approach. The latest twelve month Free Cash Flow is about $4.17b. Analysts provide explicit forecasts out to 2030, with Simply Wall St extending the path further using its own assumptions. By 2030, projected Free Cash Flow is $7.53b, with intermediate annual estimates between 2026 and 2035 ranging from about $5.36b to $9.35b before discounting.

After discounting all these projected cash flows back to today, the model arrives at an estimated intrinsic value of about $178.37 per share for Analog Devices.

Compared with the current share price of about $408, this DCF output suggests the stock is 129.0% above this estimated value based on these inputs and assumptions.

Result: OVERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Analog Devices may be overvalued by 129.0%. Discover 51 high quality undervalued stocks or create your own screener to find better value opportunities.

Approach 2: Analog Devices Price vs Earnings

For profitable companies like Analog Devices, the P/E ratio is a useful way to see how much you are paying for each dollar of current earnings. It ties the share price directly to the earnings that support it, which many investors treat as the core driver of long term value.

What counts as a “normal” P/E depends on how the market views a company’s growth prospects and risk. Higher expected growth or lower perceived risk can justify a higher multiple, while slower expected growth or higher risk usually aligns with a lower P/E.

Analog Devices currently trades on a P/E of 73.68x. That is above both the Semiconductor industry average of 53.66x and the peer group average of 37.55x. Simply Wall St also calculates a proprietary “Fair Ratio” of 36.41x for Analog Devices, which reflects factors such as earnings growth, industry, profit margin, market cap and risk profile. This Fair Ratio offers a more tailored benchmark than simple peer or industry comparisons because it adjusts for the specific characteristics of the company rather than assuming all peers deserve similar multiples.

Comparing the current P/E of 73.68x with the Fair Ratio of 36.41x points to the stock trading well above this custom benchmark.

Result: OVERVALUED

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Upgrade Your Decision Making: Choose your Analog Devices Narrative

Earlier it was mentioned that there is an even better way to understand valuation. Narratives are introduced as a simple way for you to attach a clear story about Analog Devices to the numbers you see, by linking your view on its future revenue, earnings and margins to a financial forecast and then to a Fair Value that you can compare with the current share price when deciding whether to buy or sell. This is done using an accessible tool on Simply Wall St’s Community page that is used by millions of investors and updates automatically when fresh news or earnings arrive. For example, one investor might align with a bullish Fair Value around US$450, while another leans toward a more cautious view closer to about US$205. Both are using the same structure of story plus forecast plus Fair Value to keep their decisions consistent as new information comes in.

For Analog Devices, however, we will make it really easy for you with previews of two leading Analog Devices Narratives:

Fair Value: US$450.00

Implied pricing gap vs last close: 9.2% below this Fair Value

Revenue growth assumption: 19.9% a year

• Expects data center, AI, automation, automotive, and IoT demand to support higher revenue and margin outcomes than consensus assumes.
• Leans on rising content per device, pricing power, and a larger internal manufacturing footprint to support earnings growth and profitability.
• Accepts meaningful risks from geopolitics, competition, industry cycles, and regulation, but treats them as manageable within a higher Fair Value of US$450.

Fair Value: US$392.94

Implied pricing gap vs last close: 4.0% above this Fair Value

Revenue growth assumption: 14.4% a year

• Frames the story around solid growth from automation, AI data center, green energy, and automotive, but with more moderate assumptions than the bullish view.
• Assumes earnings progress supported by investment in R&D, partnerships, and capacity, while also factoring in margin and volatility risks.
• Treats the stock as close to fairly priced against a consensus Fair Value of about US$393, with upside and downside shaped by competition, geopolitical issues, and capital intensity.

If you want to see how these narratives evolve as fresh data comes through, it can help to track both the bullish and more cautious Fair Values side by side so you can decide which set of assumptions is closer to your own view of Analog Devices.

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Analog Devices on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

Do you think there's more to the story for Analog Devices? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.