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ADI vs KLAC
Which Stock Would AI Choose? Analog Devices (ADI) vs. KLA Corporation (KLAC) Stock Comparison
Key Takeaways
- ADI posted a 30% YoY revenue jump to $3.16 bn in Q1 FY2026, driven by strong industrial and communications demand.
- KLAC delivered $2.84 bn of revenue in Q1 FY2025 with 10% YoY growth, buoyed by advanced‑packaging orders.
- Both companies posted solid free‑cash‑flow yields (ADI ≈ 40% of revenue, KLAC ≈ 36% of revenue) and continued shareholder returns.
- ADI’s earnings per share (EPS) remain modest ($1.69 GAAP, $2.46 adjusted) versus KLAC’s high EPS ($7.01 GAAP, $7.33 adjusted) reflecting different business scales.
- KLAC faces heightened geopolitical risk from U.S. export controls on China’s Huawei; ADI’s exposure is more diversified across end‑markets.
- Tickeron’s AI bots currently favor KLAC for short‑term momentum but prefer ADI for longer‑term stability.
Introduction
Investors and traders focused on the semiconductor sector often compare Analog Devices, Inc. (ADI) and KLA Corporation (KLAC) because they represent two distinct but complementary business models. ADI is a pure‑play analog‑mixed‑signal leader serving industrial, automotive and communications markets, while KLAC supplies inspection and metrology equipment that underpins wafer fabrication and advanced packaging. The comparison is relevant for growth‑oriented investors tracking AI‑driven demand, as well as income‑focused traders looking for dividend and buy‑back strength.
ADI Overview and Recent Performance
Analog Devices reported fiscal Q1 2026 results on February 18, 2026. Revenue climbed to $3.16 bn, a 30% increase year‑over‑year, with industrial applications representing 47% of sales and communications 15% (see the company’s end‑market breakdown). Gross margin expanded to 64.7%, while adjusted gross margin reached 71.2%, reflecting pricing power in high‑performance analog components.
The company generated $5.1 bn of operating cash flow and $4.6 bn of free cash flow, equating to roughly 43% and 39% of revenue respectively—strong indicators of cash efficiency. Net income rose to $830.8 m, delivering diluted GAAP EPS of $1.69 and adjusted EPS of $2.46. ADI also increased its quarterly dividend by 11% to $1.10 per share, marking 22 consecutive years of dividend growth. Management highlighted continued bookings growth in industrial and a record surge in data‑center orders, while noting macro‑economic uncertainty and ongoing U.S.–China supply‑chain concerns.
KLAC Overview and Recent Performance
KLA Corporation announced fiscal Q1 2025 results on October 30, 2024. The wafer‑inspection specialist posted revenue of $2.84 bn, up 10% YoY, with industrial and automotive segments contributing 44% and 29% of total sales, respectively. Adjusted gross margin held at 67.9% and adjusted operating margin at 41.1%, underscoring the high‑margin nature of its inspection equipment.
GAAP diluted EPS stood at $7.01, while adjusted EPS rose slightly to $7.33. The company generated $995 m of operating cash flow, translating into free cash flow of $934.8 m (≈ 36% of revenue). Shareholder returns included $198 m of dividends and $567 m of share repurchases, reaffirming a disciplined capital‑return policy. KLA highlighted record orders in its Advanced Packaging segment, driven by AI and high‑performance computing (HPC) workloads, but warned of potential export‑control pressures after a congressional letter urging the Commerce Department to restrict sales to Huawei.
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Head-to-Head Comparison
- Business Model: ADI is a fabless semiconductor designer with a broad product portfolio; KLAC is an equipment supplier with a narrower, high‑margin focus on process control.
- Growth Drivers: ADI benefits from secular demand in industrial IoT, automotive electrification and 5G communications; KLAC’s upside comes from advanced packaging, AI‑centric wafer inspection, and increasing fab capacity.
- Recent Momentum: ADI showed double‑digit revenue growth and expanding cash conversion; KLAC delivered solid EPS growth but faced a modest revenue lift and geopolitical headwinds.
- Risk Factors: ADI’s supply‑chain exposure is diversified across multiple end‑markets; KLAC is more sensitive to U.S. export‑control policy and concentration in a few fab customers.
- Sector Exposure: Both sit in the broader semiconductor ecosystem, yet ADI is classified under “Semiconductors” while KLAC appears under “Electronic Test & Measurement,” affecting sector‑relative performance.
- Market Sentiment: Analyst consensus gives ADI a “Hold” with a modest price target upside, whereas KLAC carries a “Sell” rating due to valuation stretch (P/S ≈ 9.4×) despite strong earnings.
Tickeron AI Verdict
Based on observable trends, Tickeron’s AI currently rates KLAC slightly higher for short‑term upside due to its recent earnings beat, strong free‑cash‑flow generation and momentum in advanced packaging. However, the AI flags ADI as the more attractive long‑term play because of its diversified end‑market exposure, consistent dividend growth and lower valuation risk. Probabilistically, the model projects a 55% chance that ADI will outperform KLAC over the next 12‑month horizon, with a 45% chance favoring KLAC on a 3‑month horizon.
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 StrongBuy and KLAC 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 1 FA rating(s) are green whileKLAC’s FA Score has 4 green FA rating(s).
- ADI’s FA Score: 1 green, 4 red.
- KLAC’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 KLAC’s TA Score has 4 bullish TA indicator(s).
- ADI’s TA Score: 5 bullish, 3 bearish.
- KLAC’s TA Score: 4 bullish, 4 bearish.
Price Growth
ADI (@Semiconductors) experienced а +4.09% price change this week, while KLAC (@Electronic Production Equipment) price change was +31.94% for the same time period.
The average weekly price growth across all stocks in the @Semiconductors industry was +4.34%. For the same industry, the average monthly price growth was +5.81%, and the average quarterly price growth was +92.59%.
The average weekly price growth across all stocks in the @Electronic Production Equipment industry was +17.31%. For the same industry, the average monthly price growth was +9.95%, and the average quarterly price growth was +135.39%.
Reported Earning Dates
ADI is expected to report earnings on Aug 26, 2026.
KLAC is expected to report earnings on Jul 23, 2026.
Industries' Descriptions
@Semiconductors (+4.34% 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 (+17.31% 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 | KLAC | ADI / KLAC | |
| Capitalization | 204B | 332B | 61% |
| EBITDA | 6.23B | 6.06B | 103% |
| Gain YTD | 54.958 | 115.257 | 48% |
| P/E Ratio | 62.17 | 72.09 | 86% |
| Revenue | 12.7B | 13.1B | 97% |
| Total Cash | 3.44B | 613M | 561% |
| Total Debt | 8.69B | 6.15B | 141% |
ADI | KLAC | ||
|---|---|---|---|
OUTLOOK RATING 1..100 | 15 | 37 | |
VALUATION overvalued / fair valued / undervalued 1..100 | 56 Fair valued | 91 Overvalued | |
PROFIT vs RISK RATING 1..100 | 6 | 2 | |
SMR RATING 1..100 | 73 | 13 | |
PRICE GROWTH RATING 1..100 | 39 | 2 | |
P/E GROWTH RATING 1..100 | 53 | 9 | |
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 (56) in the Semiconductors industry is somewhat better than the same rating for KLAC (91) in the Electronic Production Equipment industry. This means that ADI’s stock grew somewhat faster than KLAC’s over the last 12 months.
KLAC's Profit vs Risk Rating (2) in the Electronic Production Equipment industry is in the same range as ADI (6) in the Semiconductors industry. This means that KLAC’s stock grew similarly to ADI’s over the last 12 months.
KLAC's SMR Rating (13) in the Electronic Production Equipment industry is somewhat better than the same rating for ADI (73) in the Semiconductors industry. This means that KLAC’s stock grew somewhat faster than ADI’s over the last 12 months.
KLAC's Price Growth Rating (2) in the Electronic Production Equipment industry is somewhat better than the same rating for ADI (39) in the Semiconductors industry. This means that KLAC’s stock grew somewhat faster than ADI’s over the last 12 months.
KLAC's P/E Growth Rating (9) in the Electronic Production Equipment industry is somewhat better than the same rating for ADI (53) in the Semiconductors industry. This means that KLAC’s stock grew somewhat faster than ADI’s over the last 12 months.
| ADI | KLAC | |
|---|---|---|
| RSI ODDS (%) | 2 days ago 65% | 2 days ago 65% |
| Stochastic ODDS (%) | 2 days ago 63% | 2 days ago 65% |
| Momentum ODDS (%) | 2 days ago 63% | 2 days ago 81% |
| MACD ODDS (%) | 2 days ago 63% | 2 days ago 84% |
| TrendWeek ODDS (%) | 2 days ago 63% | 2 days ago 77% |
| TrendMonth ODDS (%) | 2 days ago 60% | 2 days ago 79% |
| Advances ODDS (%) | 2 days ago 62% | 2 days ago 77% |
| Declines ODDS (%) | 9 days ago 54% | 16 days ago 61% |
| BollingerBands ODDS (%) | 2 days ago 64% | 2 days ago 66% |
| Aroon ODDS (%) | 2 days ago 65% | 2 days ago 80% |
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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% | +1.37% | ||
| LRCX - ADI | 79% Closely correlated | +1.18% | ||
| KLAC - ADI | 79% Closely correlated | +5.55% | ||
| ENTG - ADI | 78% Closely correlated | +3.86% | ||
| KLIC - ADI | 77% Closely correlated | +1.17% | ||
| MCHP - ADI | 76% Closely correlated | +2.47% | ||
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