Critical Survey: Analog Devices (NASDAQ:ADI) vs. Cirrus Logic (NASDAQ:CRUS)

Analog Devices (NASDAQ:ADI) and Cirrus Logic (NASDAQ:CRUS) are both computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.

Analyst Ratings

This is a breakdown of current ratings and price targets for Analog Devices and Cirrus Logic, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Analog Devices 0 6 12 0 2.67
Cirrus Logic 2 3 2 0 2.00

Analog Devices presently has a consensus target price of $109.41, indicating a potential upside of 5.46%. Cirrus Logic has a consensus target price of $43.17, indicating a potential upside of 8.02%. Given Cirrus Logic’s higher possible upside, analysts clearly believe Cirrus Logic is more favorable than Analog Devices.

Dividends

Analog Devices pays an annual dividend of $2.16 per share and has a dividend yield of 2.1%. Cirrus Logic does not pay a dividend. Analog Devices pays out 36.4% of its earnings in the form of a dividend. Analog Devices has raised its dividend for 9 consecutive years.

Risk and Volatility

Analog Devices has a beta of 1.37, suggesting that its stock price is 37% more volatile than the S&P 500. Comparatively, Cirrus Logic has a beta of 0.85, suggesting that its stock price is 15% less volatile than the S&P 500.

Valuation & Earnings

This table compares Analog Devices and Cirrus Logic’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Analog Devices $6.20 billion 6.20 $1.50 billion $5.94 17.51
Cirrus Logic $1.19 billion 1.96 $89.99 million $2.05 19.43

Analog Devices has higher revenue and earnings than Cirrus Logic. Analog Devices is trading at a lower price-to-earnings ratio than Cirrus Logic, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Analog Devices and Cirrus Logic’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Analog Devices 25.18% 19.17% 10.23%
Cirrus Logic 7.59% 10.65% 8.76%

Institutional and Insider Ownership

89.6% of Analog Devices shares are held by institutional investors. Comparatively, 84.7% of Cirrus Logic shares are held by institutional investors. 0.5% of Analog Devices shares are held by insiders. Comparatively, 2.8% of Cirrus Logic shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Analog Devices beats Cirrus Logic on 13 of the 17 factors compared between the two stocks.

Analog Devices Company Profile

Analog Devices, Inc. engages in the design, development, manufacture, and marketing of integrated circuits (ICs). Its products include industrial process control systems, medical imaging equipment, factory process automation systems, patient vital signs monitoring devices, instrumentation and measurement systems, wireless infrastructure equipment, energy management systems, networking equipment, aerospace and defense electronics, optical systems, automobiles, and portable consumer devices. The company was founded by Raymond P. Stata and Matthew Lorber in 1965 and is headquartered in Norwood, MA.

Cirrus Logic Company Profile

Cirrus Logic, Inc., a fabless semiconductor company, develops, manufactures, and markets analog and mixed-signal integrated circuits (ICs) for a range of consumer and industrial markets. The company offers portable and non-portable audio, and other products. Its products include analog and mixed-signal audio converters, and digital signal processing products for mobile applications; codecs-chips that integrate analog-to-digital converters and digital-to-analog converters into a single IC; smart codecs, a codec with digital signal processer; boosted amplifiers; micro-electromechanical systems microphones; digital interface products; and standalone digital signal processors. The company also provides SoundClear technology, which consists of a portfolio of tools, software, and algorithms that offer enhanced voice quality, voice capture, and audio playback features. It provides its products for portable applications, including smartphones, tablets, digital headsets, and speakers, as well as for wearables, such as smart watches and smart bands, VR headsets, and action cameras. The company's products are also used in laptops, audio/video receivers, home theater systems, set-up boxes, musical instruments, and professional audio products applications; and serve the automotive market, which include satellite radio systems, telematics, and multi-speaker car-audio systems. In addition, the company's products are used in industrial and energy-related applications, including digital utility meter, power supply, energy control, energy measurement, and energy exploration applications. It markets and sells its products through direct sales force, external sales representatives, and distributors in the United States and internationally. Cirrus Logic, Inc. was founded in 1984 and is headquartered in Austin, Texas.

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