An independent two-stage DCF analysis by a frontier AI model.
" data-astro-cid-6tmsu3zw> ADI operates in a highly cyclical semiconductor industry. While FY2025 saw a sharp 37% FCF recovery, the long-term trend is more moderate. A 9% CAGR captures the secular tailwinds of automotive electronics, industrial automation, and digital healthcare, while acknowledging periodic inventory corrections.
" data-astro-cid-6tmsu3zw> With the 10Y Treasury at 4.18%, we require a healthy risk premium to own equities. At 9.5%, we are demanding a solid return that adequately compensates for ADI's moderate cyclicality, offset by its highly sticky B2B customer base and strong margins.
" data-astro-cid-6tmsu3zw> 3.5% slightly exceeds long-term inflation targets, implying ADI maintains a small amount of real growth and pricing power indefinitely. Given the analog semiconductor market's high barriers to entry and ADI's scale post-Maxim acquisition, this is a defensible terminal assumption.
Intrinsic value per share under varying discount rate and terminal growth rate assumptions.
| WACC ↓ / Terminal → | 2.5% | 3.0% | 3.5% | 4.0% | 4.5% |
|---|---|---|---|---|---|
| 2.5% | $11.00 | $11.00 | $4.45 | $2.79 | $2.03 |
| 3.0% | $11.00 | $41.56 | $6.34 | $3.43 | $2.35 |
| 3.5% | $11.00 | $11.00 | $11.00 | $4.45 | $2.79 |
| 4.0% | $11.00 | $11.00 | $41.56 | $6.34 | $3.43 |
| 4.5% | $11.00 | $11.00 | $11.00 | $11.00 | $4.45 |
■ Undervalued vs current price ■ Overvalued vs current price
Westmount Research. "Analog Devices (ADI) Intrinsic Value: A DCF Analysis." westmountfundamentals.com, March 18, 2026.
Disclaimer: The numbers presented on this page are for educational and entertainment purposes only. They are the result of a deterministic mathematical model fed with assumptions generated by an Artificial Intelligence (Gemini 3.1). This does not constitute investment advice. Always conduct your own due diligence before investing in the stock market.