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Exclusive Article Can Analog Devices Really Hit $400 This Year?By Thomas Hughes. Date Posted: 2/18/2026. 
At a Glance - Analog Devices has a strengthening tailwind from end-market normalization and data center demand.
- Guidance is of "wow" quality and is likely to be cautious.
- Analysts are lifting price targets, pointing to fresh highs this year.
Analog Devices’ (NASDAQ: ADI) share price could easily top $400 this year, driven by an outlook strengthened by the company’s fiscal Q1 2026 earnings report. End-market normalization is becoming a robust tailwind as AI drives datacenter and broader semiconductor demand. For ADI investors, that implies sustained, accelerating growth, wider margins and improved cash flow to support healthy capital returns. Analog Devices Reports 4th Quarter of Accelerating Growth: Guidance Wows The Wall Street Journal is asking whether a stock market crash is coming. Research from Weiss Ratings suggests the first half of 2026 could be very tough for certain stocks as a radical shift hits the market. Some of America's most popular names could take serious damage. Analysts have identified five stocks you should consider avoiding before this event plays out. If these are in your portfolio, you'll want to review your positions carefully. See the five stocks to avoid and learn what's driving this shift. Analog Devices delivered a strong quarter, with growth across all end markets. The company reported $3.16 billion in net revenue, a 30.6% year-over-year (YOY) increase that outpaced consensus by 130 basis points. Segmentally, Industrial and Communications, which includes the data center business, led with gains of 38% and 63%, respectively. Automotive was the weakest link, up only 8%, but it is expected to strengthen over time. The Consumer segment grew by an impressive 27%. Margin news was notable. The company widened its GAAP margin by a quadruple-digit figure and its adjusted margin by a triple-digit figure. Adjusted gross margin improved by 240 basis points, and adjusted operating margin rose by 500 basis points, driving a 52% increase in adjusted earnings and robust free cash flow. Operating cash flow improved 43% on a trailing 12-month basis, while free cash flow rose 39% to over $4.5 billion. The strength in free cash flow is critical: it enables reinvestment and capital returns while maintaining a healthy balance sheet. Guidance was the market mover. The company’s forecast for Q2 revenue and earnings came in significantly above consensus even at the low end of its range, implying at least 500 basis points of outperformance in the upcoming quarter and more than 1,000 basis points at the high end. Given the results and clear momentum, the company is likely to perform at the high end of its guidance range—or potentially outperform it. Analog Devices Capital Return Is Dialing in on Dividend Aristocrat Status Analog Devices' capital return program is notable for its steady dividend increases. The company announced its 22nd consecutive annual dividend increase alongside its fiscal Q1 (FQ1) release, sustaining a low-double-digit distribution CAGR and putting it on track to become a Dividend Aristocrat by decade’s end. (Note that the company's fiscal reporting period does not align with the calendar year.) Inclusion in the Dividend Aristocrats index matters because it tends to broaden buy-and-hold ownership, which can reduce share-price volatility. Until then, the payout remains safe at less than 50% of the earnings outlook and yields a market-average 1.15% as of the pre-release close. Share repurchases are also significant. Q1 buybacks reduced the share count by an average of about 1.4% year over year in the quarter and are expected to continue at a similar pace through the year. The balance sheet shows no red flags: cash and current assets increased, long-term debt decreased, and equity stayed steady. Leverage remains low, with cash up 16% year-to-date; long-term debt is roughly 2.5x the cash balance and about 0.2x equity. 
Analyst Trends Drive Analog Devices’ Market Sentiment The initial analysts’ response to Analog Devices’ FQ1 report is bullish, sustaining the trend. Price-target increases from Stifel Nicolaus and Cantor Fitzgerald push the stock toward the top of its target range, with Cantor’s $400 target matching the current high. That target implies roughly 18% upside from the pre-release high, which could be reached before the second half of the year. MarketBeat data shows strong coverage: 29 analysts tracked (up from a year ago), a firming Moderate Buy consensus, and price targets trending higher. Institutional activity is also supportive. While institutional selling increased over the past 12 months, the quarterly flow remained net bullish through the year and continued in early 2026. In the first six weeks of the year, purchases outweighed sales by more than $1.50 in buys for each $1 in sales — a positive tailwind for price action given the 87% institutional ownership rate. Short sellers do not appear to be a headwind. Short interest remains low, below 2%, and was declining as of early February. Analog Devices Rockets Higher on Strong Results ADI’s shares jumped more than 5% in premarket trading after the release. The move reflects the market’s surprise at the strength of the report and suggests the rally could continue. The primary risk is near-term profit-taking that could cap gains; in that case, the stock may consolidate at the new highs or pull back before attempting to set fresh highs.
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