© Reuters. Cowen Starts Analog Devices (ADI) at Outperform; Texas Instruments (TXN) at Market Perform
By Senad Karaahmetovic
Cowen analysts initiated research coverage on Analog Devices (NASDAQ:) with an Outperform rating and a $180 per share price target.
The analysts see the “attractive value” that ADI shares offer at the moment. ADI stock is especially attractive “in an environment when TMT investors are seeking relative safety.”
Moreover, ADI offers “best-in-class margins and capital return profile with a fab-lite model that we believe is well positioned to sustain strong dividend growth and a material repurchase program through-cycle.”
Elsewhere, the analysts also initiated research coverage on Texas Instruments (NASDAQ:) with a Market Perform rating and a $170 per share price target. Analysts are worried that necessary investments in long-term capacity will likely pressure gross margins and free cash flow generation.
“TI offers best-in-class margin profile with a multi-decade track record of operational execution. While we see multiple secular growth drivers allowing TI’s analog and embedded businesses to see GDP+ growth, in an uncertain backdrop we believe near-term upside could be limited,” analysts wrote in a separate client note.
Hence, they opted to stay on the sidelines and wait to see “more confidence in the macro/pricing backdrop or a more attractive entry point before recommending investors add to positions.”
Shares of ADI and TXN are down 1% and 1.3%, respectively.
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