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ADI vs AMAT
Which Stock Would AI Choose? Analog Devices (ADI) vs. Applied Materials (AMAT) Stock Comparison
Key Takeaways
- Both companies posted record fiscal 2024 revenue, but ADI grew 2.5% YoY versus AMAT’s 2% YoY increase.
- ADI delivered a non‑GAAP operating margin of 29.5%, slightly above AMAT’s 29.3%.
- Both firms benefit from AI‑driven demand for energy‑efficient computing, yet ADI leans heavily on analog‑mixed‑signal solutions, while AMAT focuses on materials‑engineering equipment for chips.
- Cash generation: ADI produced $3.1 bn free cash flow in FY24; AMAT generated $7.5 bn free cash flow, supporting a larger share‑repurchase program.
- Both companies target FY25 revenue growth of ~7% YoY, but AMAT expects higher absolute revenue ($7.15 bn vs. $6.5 bn) due to its larger product scope.
Introduction
This article compares two leading semiconductor‑related equities—ADI (Analog Devices, Inc.) and AMAT (Applied Materials, Inc.). Both firms serve the fast‑growing AI and data‑center markets, yet they occupy distinct parts of the value chain. Investors and traders focused on AI‑driven megatrends will find this side‑by‑side review useful for positioning capital in the current market environment.
Analog Devices (ADI) Overview and Recent Performance
Analog Devices designs, manufactures, and markets high‑performance analog, mixed‑signal, and digital signal processing (DSP) integrated circuits (ICs). Its product portfolio underpins industrial automation, automotive electronics, communications, and consumer products. Over the past 30 days, ADI reported fiscal 2024 revenue of $9.43 bn (≈2.5% YoY) and non‑GAAP earnings per share (EPS) of $1.67, a 17% YoY increase. The company achieved a non‑GAAP operating margin of 29.5%, reflecting strong pricing discipline and cost efficiencies in the analog‑mixed‑signal segment.
Key recent developments include:
- AI‑enabled analog solutions: new high‑speed data converters and precision amplifiers for AI‑accelerator front‑ends, driving demand in data‑center and edge compute.
- Automotive expansion: shipments to electric‑vehicle (EV) power‑train control units grew 34% YoY, supported by the company’s “Automotive 2025” roadmap.
- R&D acceleration: FY24 R&D spend rose 6% to $820 m, targeting a next‑generation mixed‑signal platform for AI inference.
- Shareholder returns: $2.4 bn returned to shareholders (dividends + repurchases), with a 45% payout ratio and a 10‑year dividend growth record.
Applied Materials (AMAT) Overview and Recent Performance
Applied Materials supplies equipment, services, and software that enable the fabrication of semiconductors and advanced displays. Its core businesses are Semiconductor Systems (wafer‑fab tools), Applied Global Services (service contracts and upgrades), and Display & Adjacent Markets. In FY24 the company posted record revenue of $27.2 bn (≈2% YoY) and non‑GAAP EPS of $8.65, a 7% YoY rise. Non‑GAAP operating margin was 29.3%.
Recent highlights (last 30 days):
- Gate‑All‑Around (GAA) momentum: $2.5 bn shipped to GAA nodes in FY24; revenue expected to double in FY25 as customers adopt GAA transistors for AI compute.
- High‑Bandwidth Memory (HBM) packaging: $700 m in FY24, up >3× YoY, reflecting AI‑driven demand for bandwidth‑intensive workloads.
- Advanced packaging growth: total Advanced Packaging revenue reached $1.7 bn, a three‑year CAGR of >80%.
- Service expansion: Applied Global Services generated $1.64 bn in Q4, up 11% YoY, with subscription‑based agreements covering >90% renewal rates and average contract lengths of 2.9 years.
- Capital allocation: $8.7 bn operating cash flow in FY24, $7.5 bn free cash flow; $5 bn returned to shareholders, AMAT still has $8.9 bn remaining repurchase authorization.
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Head‑to‑Head Comparison
| Category | Analog Devices (ADI) | Applied Materials (AMAT) |
|---|---|---|
| Primary Market | Analog/mixed‑signal ICs for industrial, automotive, communications, consumer | Semiconductor fab equipment & services (materials engineering) |
| FY24 Revenue | $9.43 bn (≈2.5% YoY) | $27.2 bn (≈2% YoY) |
| Non‑GAAP Operating Margin | 29.5% | 29.3% |
| AI‑related Growth Drivers | High‑speed data converters for AI accelerators; automotive AI sensors | GAA transistors, backside power distribution, HBM packaging—key for AI compute |
| Capital Expenditure Exposure | ~$850 m CAPEX (≈9% of revenue) | ~$2.1 bn CAPEX (≈8% of revenue) – includes large GAA & advanced packaging tool spend |
| Free Cash Flow (FY24) | $3.1 bn | $7.5 bn |
| Share‑repurchase Authorization | $5 bn remaining | $8.9 bn remaining |
| China Revenue Share | ~30% (stable YoY) | ~30% (normalized after earlier peak) |
| Service / Subscription Revenue | ~$1.0 bn (≈10% of total, increasing subscription contracts) | $1.64 bn (≈6% of total) with >90% renewal rates |
| Key Risks | Supply‑chain constraints for silicon wafers; slowdown in automotive demand; pricing pressure in industrial segment | Geopolitical restrictions on China equipment sales; cyclicality of wafer‑fab capacity upgrades; rapid technology transitions could accelerate equipment obsolescence |
Tickeron AI Verdict
Based on the data above, Tickeron’s AI models currently assign a modest edge to AMAT for the following reasons:
- Scale & cash generation: With $7.5 bn free cash flow, Applied Materials can sustain larger repurchases and fund R&D for emerging GAA and advanced packaging technologies that are critical to AI compute.
- Strategic inflection points: GAA transistors, backside power distribution, and HBM packaging are expected to double addressable market share in FY25, giving Applied a clear revenue tailwind.
- Service momentum: The high‑renewal, multi‑year subscription model provides a recurring revenue cushion that can soften cyclical downturns.
Nevertheless, the margin advantage of ADI, its diversified analog product mix, and its strong dividend track record keep it attractive for income‑oriented investors. The AI verdict therefore suggests a slight probabilistic preference for AMAT, while recommending ADI for portfolios emphasizing dividend yield and lower exposure to capital‑intensive equipment cycles.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer. Disclaimers and Limitations
To compare these two companies we present long-term analysis, their fundamental ratings and make comparative short-term technical analysis which are presented below. The conclusion is ADI is a Hold and AMAT is a Hold.
Long-Term Analysis
It is best to consider a long-term outlook for a ticker by using Fundamental Analysis (FA) ratings. The rating of 1 to 100, where 1 is best and 100 is worst, is divided into thirds. The first third (a green rating of 1-33) indicates that the ticker is undervalued; the second third (a grey number between 34 and 66) means that the ticker is valued fairly; and the last third (red number of 67 to 100) reflects that the ticker is undervalued. We use an FA Score to show how many ratings show the ticker to be undervalued (green) or overvalued (red).
ADI’s FA Score shows that 2 FA rating(s) are green whileAMAT’s FA Score has 4 green FA rating(s).
- ADI’s FA Score: 2 green, 3 red.
- AMAT’s FA Score: 4 green, 1 red.
Short-Term Analysis
It is best to consider a short-term outlook for a ticker by using Technical Analysis (TA) indicators. We use Odds of Success as the percentage of outcomes which confirm successful trade signals in the past.
If the Odds of Success (the likelihood of the continuation of a trend) for each indicator are greater than 50%, then the generated signal is confirmed. A green percentage from 90% to 51% indicates that the ticker is in a bullish trend. A red percentage from 90% - 51% indicates that the ticker is in a bearish trend. All grey percentages are below 50% and are considered not to confirm the trend signal.
ADI’s TA Score shows that 5 TA indicator(s) are bullish while AMAT’s TA Score has 4 bullish TA indicator(s).
- ADI’s TA Score: 5 bullish, 2 bearish.
- AMAT’s TA Score: 4 bullish, 3 bearish.
Price Growth
ADI (@Semiconductors) experienced а +4.19% price change this week, while AMAT (@Electronic Production Equipment) price change was +9.29% for the same time period.
The average weekly price growth across all stocks in the @Semiconductors industry was -0.05%. For the same industry, the average monthly price growth was -2.24%, and the average quarterly price growth was +92.77%.
The average weekly price growth across all stocks in the @Electronic Production Equipment industry was -0.28%. For the same industry, the average monthly price growth was +8.67%, and the average quarterly price growth was +129.72%.
Reported Earning Dates
ADI is expected to report earnings on Aug 26, 2026.
AMAT is expected to report earnings on Aug 13, 2026.
Industries' Descriptions
@Semiconductors (-0.05% weekly)The semiconductor industry manufacturers all chip-related products, including research and development. These chips are used in innumerable electronic devices, including computers, cell phones, smartphones, and GPSs. Intel Corporation, NVIDIA Corp., and Broadcomm are some of the prominent players in this industry. Semiconductor companies usually tend to do well during periods of healthy economic growth, thereby inducing further research and development in the industry – which in turn augurs well for productivity and growth in the economy. In the near future, demand for semiconductor products (and possibly innovation within the segment) should only expand further, with the proliferation of 5G, autonomous vehicles, IoT, and various AI-driven electronics set to herald a new, advanced chapter in the technology-driven world as we know it. With burgeoning prospects comes great competition. In 2015, SIA estimated that U.S. semiconductor industry ranks as the second most competitive U.S. industry out of 2882 U.S. industries designated manufacturers by the U.S. Census Bureau.
@Electronic Production Equipment (-0.28% weekly)The electronic production equipment industry makes equipment used to produce semiconductors. Such equipment includes wafer fabrication, plasma etching and photo-resist processing equipment. The industry also makes chemical vapor deposition processing systems and photomasks, which are high-purity quartz plates that contain patterns to define integrated circuits layouts. Applied Materials, Inc., Lam Research Corporation, and KLA-Tencor Corporation are examples of electronic production equipment manufacturing companies.
| ADI | AMAT | ADI / AMAT | |
| Capitalization | 198B | 465B | 43% |
| EBITDA | 6.23B | 11.1B | 56% |
| Gain YTD | 65.228 | 149.728 | 44% |
| P/E Ratio | 66.29 | 60.22 | 110% |
| Revenue | 12.7B | 29B | 44% |
| Total Cash | 3.44B | 8.24B | 42% |
| Total Debt | 8.69B | 7.27B | 119% |
ADI | AMAT | ||
|---|---|---|---|
OUTLOOK RATING 1..100 | 23 | 45 | |
VALUATION overvalued / fair valued / undervalued 1..100 | 58 Fair valued | 78 Overvalued | |
PROFIT vs RISK RATING 1..100 | 6 | 5 | |
SMR RATING 1..100 | 73 | 24 | |
PRICE GROWTH RATING 1..100 | 7 | 2 | |
P/E GROWTH RATING 1..100 | 47 | 5 | |
SEASONALITY SCORE 1..100 | 50 | 50 |
Tickeron ratings are formulated such that a rating of 1 designates the most successful stocks in a given industry, while a rating of 100 points to the least successful stocks for that industry.
ADI's Valuation (58) in the Semiconductors industry is in the same range as AMAT (78) in the Electronic Production Equipment industry. This means that ADI’s stock grew similarly to AMAT’s over the last 12 months.
AMAT's Profit vs Risk Rating (5) in the Electronic Production Equipment industry is in the same range as ADI (6) in the Semiconductors industry. This means that AMAT’s stock grew similarly to ADI’s over the last 12 months.
AMAT's SMR Rating (24) in the Electronic Production Equipment industry is somewhat better than the same rating for ADI (73) in the Semiconductors industry. This means that AMAT’s stock grew somewhat faster than ADI’s over the last 12 months.
AMAT's Price Growth Rating (2) in the Electronic Production Equipment industry is in the same range as ADI (7) in the Semiconductors industry. This means that AMAT’s stock grew similarly to ADI’s over the last 12 months.
AMAT's P/E Growth Rating (5) in the Electronic Production Equipment industry is somewhat better than the same rating for ADI (47) in the Semiconductors industry. This means that AMAT’s stock grew somewhat faster than ADI’s over the last 12 months.
| ADI | AMAT | |
|---|---|---|
| RSI ODDS (%) | N/A | 2 days ago 65% |
| Stochastic ODDS (%) | 2 days ago 69% | 2 days ago 69% |
| Momentum ODDS (%) | 2 days ago 68% | 2 days ago 74% |
| MACD ODDS (%) | 2 days ago 58% | 2 days ago 77% |
| TrendWeek ODDS (%) | 2 days ago 63% | 2 days ago 76% |
| TrendMonth ODDS (%) | 2 days ago 61% | 2 days ago 77% |
| Advances ODDS (%) | 2 days ago 62% | 2 days ago 76% |
| Declines ODDS (%) | 7 days ago 54% | N/A |
| BollingerBands ODDS (%) | 2 days ago 61% | 2 days ago 65% |
| Aroon ODDS (%) | 2 days ago 67% | 2 days ago 75% |
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ADI and
Correlation & Price change
A.I.dvisor indicates that over the last year, ADI has been closely correlated with LRCX. These tickers have moved in lockstep 79% of the time. This A.I.-generated data suggests there is a high statistical probability that if ADI jumps, then LRCX could also see price increases.
| Ticker / NAME | Correlation To ADI | 1D Price Change % | ||
|---|---|---|---|---|
| ADI | 100% | +2.54% | ||
| LRCX - ADI | 79% Closely correlated | +5.27% | ||
| KLAC - ADI | 79% Closely correlated | +3.70% | ||
| ENTG - ADI | 78% Closely correlated | +2.93% | ||
| KLIC - ADI | 77% Closely correlated | +1.99% | ||
| MCHP - ADI | 76% Closely correlated | +2.95% | ||
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AMAT and
Correlation & Price change
A.I.dvisor indicates that over the last year, AMAT has been closely correlated with LRCX. These tickers have moved in lockstep 88% of the time. This A.I.-generated data suggests there is a high statistical probability that if AMAT jumps, then LRCX could also see price increases.
| Ticker / NAME | Correlation To AMAT | 1D Price Change % | ||
|---|---|---|---|---|
| AMAT | 100% | +3.74% | ||
| LRCX - AMAT | 88% Closely correlated | +5.27% | ||
| KLAC - AMAT | 85% Closely correlated | +3.70% | ||
| NVMI - AMAT | 78% Closely correlated | +1.35% | ||
| ASML - AMAT | 77% Closely correlated | -0.02% | ||
| ONTO - AMAT | 76% Closely correlated | +4.23% | ||
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