Analysis of Investments
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- Common-Size Income Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Long-term (Investment) Activity Ratios
- Enterprise Value (EV)
- Return on Assets (ROA) since 2005
- Current Ratio since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Book Value (P/BV) since 2005
- Price to Sales (P/S) since 2005
- Aggregate Accruals
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Adjustment to Net Income (Loss): Mark to Market Available-for-sale Securities
Analog Devices Inc., adjustment to net income
US$ in thousands
| 12 months ended: | Nov 2, 2024 | Oct 28, 2023 | Oct 29, 2022 | Oct 30, 2021 | Oct 31, 2020 | Nov 2, 2019 | |
|---|---|---|---|---|---|---|---|
| Net income (as reported) | |||||||
| Add: Change in fair value of available-for-sale securities | |||||||
| Net income (adjusted) |
Based on: 10-K (reporting date: 2024-11-02), 10-K (reporting date: 2023-10-28), 10-K (reporting date: 2022-10-29), 10-K (reporting date: 2021-10-30), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-11-02).
- Net Income Trends
- The reported net income and adjusted net income show identical values across all reported periods, indicating that no adjustments have been made to the net income figures presented.
- From November 2019 to October 2020, net income decreased from approximately 1.36 billion to 1.22 billion US dollars, marking a decline during this period.
- In the subsequent years, net income exhibited recovery and growth, rising to about 1.39 billion in October 2021 and showing a significant increase to 2.75 billion in October 2022.
- The upward trajectory continued reaching a peak of approximately 3.31 billion in October 2023, which represents the highest value within the dataset.
- However, in the most recent period ending November 2024, net income dropped sharply to approximately 1.64 billion US dollars, marking a considerable decline compared to the preceding two years.
- Overall, net income displays volatility with a notable peak in 2023 followed by a significant decrease in 2024, suggesting potential challenges or changes in profitability during the latest period.
Adjusted Profitability Ratios: Mark to Market Available-for-sale Securities (Summary)
Analog Devices Inc., adjusted profitability ratios
Based on: 10-K (reporting date: 2024-11-02), 10-K (reporting date: 2023-10-28), 10-K (reporting date: 2022-10-29), 10-K (reporting date: 2021-10-30), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-11-02).
- Net Profit Margin Trends
- The net profit margin demonstrated some volatility over the six-year period. Beginning at 22.75% in 2019, it experienced a slight decline to 21.79% in 2020, followed by a more pronounced reduction to 19% in 2021. A recovery phase saw the margin increase to 22.88% in 2022 and peak at 26.94% in 2023. However, by 2024, the margin dropped significantly to 17.35%, suggesting challenges impacting profitability in the most recent year.
- Return on Equity (ROE) Patterns
- The reported and adjusted ROE declined markedly from 11.64% in 2019 to 3.66% in 2021. After this low point, the ROE rebounded moderately to 7.54% in 2022 and further to 9.32% in 2023. Nonetheless, a decline to 4.65% was observed in 2024. Overall, the ROE exhibited considerable fluctuation, with the lowest performance in 2021 and a partial but not sustained recovery before another setback in 2024.
- Return on Assets (ROA) Developments
- The ROA followed a trend similar to ROE, starting at 6.37% in 2019 and decreasing steadily to 2.66% in 2021. The ratio improved in the following years, reaching 5.46% in 2022 and 6.79% in 2023. In 2024, ROA declined once again to 3.39%. This pattern indicates alternating periods of diminished and enhanced asset profitability, with the most significant downturn occurring in 2021 and a partial recovery thereafter.
- Overall Observations
- Across all key profitability metrics, the period reflects a cycle of initial decline around 2021, followed by recovery phases in 2022 and 2023, and a notable decrease in 2024. The synchronous movement in net profit margin, ROE, and ROA suggests the company faced challenges impacting overall efficiency and profitability in the most recent year, after improving performance in the preceding two years.
Analog Devices Inc., Profitability Ratios: Reported vs. Adjusted
Adjusted Net Profit Margin
Based on: 10-K (reporting date: 2024-11-02), 10-K (reporting date: 2023-10-28), 10-K (reporting date: 2022-10-29), 10-K (reporting date: 2021-10-30), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-11-02).
2024 Calculations
1 Net profit margin = 100 × Net income ÷ Revenue
= 100 × ÷ =
2 Adjusted net profit margin = 100 × Adjusted net income ÷ Revenue
= 100 × ÷ =
- Net Income Trends
- The reported net income demonstrated an overall increasing trend from 2019 to 2023, starting at approximately $1.36 billion in 2019 and reaching a peak of around $3.31 billion in 2023. Notably, there was a significant jump between 2021 and 2022, where net income nearly doubled. However, in 2024, the net income declined substantially to about $1.64 billion, approximately half of the prior year's peak.
- Adjusted Net Income Trends
- The adjusted net income figures follow an identical pattern to the reported net income over the same period, indicating no adjustments affecting net income for these years. The adjusted figures confirm the same growth and decline trajectory seen in the reported numbers.
- Net Profit Margin Trends
- The reported net profit margin starting at 22.75% in 2019 displayed some variability over the years. It showed a slight decline in the early years, reducing to 19% in 2021. Subsequently, it improved notably, peaking at 26.94% in 2023, suggesting increased profitability relative to revenue. Yet, the margin declined sharply to 17.35% in 2024, marking the lowest point in the data series and indicating diminished profitability in that year.
- Adjusted Net Profit Margin Trends
- The adjusted net profit margin mirrors the reported margin exactly, reinforcing the consistency between reported and adjusted profitability metrics throughout the periods analyzed.
- Overall Insights
- The data depicts a period of growth in both net income and profit margins through 2023, characterized by a significant rise in profitability metrics in the final years before a marked reversal in 2024. The decline in 2024 suggests potential challenges affecting earnings and margins, requiring further investigation to ascertain underlying causes. The identical reported and adjusted data implies stability in the quality and reliability of earnings reported without material adjustments.
Adjusted Return on Equity (ROE)
Based on: 10-K (reporting date: 2024-11-02), 10-K (reporting date: 2023-10-28), 10-K (reporting date: 2022-10-29), 10-K (reporting date: 2021-10-30), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-11-02).
2024 Calculations
1 ROE = 100 × Net income ÷ Shareholders’ equity
= 100 × ÷ =
2 Adjusted ROE = 100 × Adjusted net income ÷ Shareholders’ equity
= 100 × ÷ =
- Net Income Trends
- The reported net income displayed a fluctuating pattern over the observed periods. Beginning at approximately 1.36 billion US dollars in 2019, it experienced a decline in 2020 to about 1.22 billion. Subsequently, there was a recovery in 2021, with net income rising to roughly 1.39 billion. The income then significantly increased in 2022 and 2023 to 2.75 billion and 3.31 billion, respectively, representing a strong growth phase. However, in the most recent period of 2024, there was a notable drop back to around 1.63 billion. The adjusted net income mirrored this exact trajectory, indicating consistency between reported and adjusted figures.
- Return on Equity (ROE) Trends
- The reported and adjusted ROE percentages followed an identical pattern with notable volatility. Starting at 11.64% in 2019, ROE declined steadily to 10.17% in 2020 and then substantially dropped to 3.66% in 2021, indicating reduced profitability relative to equity during this year. A partial recovery took place in 2022 and 2023, rising to 7.54% and 9.32% respectively, but ROE declined again in 2024 to 4.65%. This fluctuation suggests challenges in maintaining consistent equity profitability over the most recent six years.
- Summary of Financial Performance
- Overall, the company exhibited significant volatility in profitability metrics across the examined time span. The sharp increase in net income during 2022 and 2023 contrasted with earlier declines, followed by a considerable decrease in 2024. This pattern was similarly reflected in the return on equity, which experienced substantial fluctuations indicative of varying effectiveness in generating returns from shareholders' equity. The alignment of adjusted and reported metrics suggests that unusual items or non-recurring events had minimal impact on the reported results.
Adjusted Return on Assets (ROA)
Based on: 10-K (reporting date: 2024-11-02), 10-K (reporting date: 2023-10-28), 10-K (reporting date: 2022-10-29), 10-K (reporting date: 2021-10-30), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-11-02).
2024 Calculations
1 ROA = 100 × Net income ÷ Total assets
= 100 × ÷ =
2 Adjusted ROA = 100 × Adjusted net income ÷ Total assets
= 100 × ÷ =
- Net Income Trends
- The reported net income exhibited variability over the analyzed periods. It initially declined from approximately 1,363 million USD in late 2019 to around 1,220 million USD by late 2020. This was followed by a moderate recovery in late 2021, reaching approximately 1,390 million USD. A significant surge occurred in late 2022, with net income more than doubling to around 2,749 million USD, continuing to increase into late 2023, peaking at approximately 3,315 million USD. However, there was a notable decrease in late 2024, with net income falling to approximately 1,635 million USD.
- Adjusted Net Income Patterns
- The adjusted net income values mirror the reported net income precisely across all periods, indicating no discrepancies between reported and adjusted figures. Therefore, the patterns and changes detailed in the reported net income apply equally to the adjusted net income.
- Return on Assets (ROA) Observations
- The reported ROA followed a somewhat fluctuating trend. Starting at 6.37% in late 2019, it decreased to 5.69% by late 2020 and further dropped substantially to 2.66% in late 2021. Subsequently, ROA recovered to 5.46% in late 2022 and improved further to 6.79% in late 2023. This improvement suggests enhanced efficiency or profitability relative to assets during this period. However, the ROA declined again to 3.39% in late 2024, indicating a reduction in asset profitability. Similar to net income, the adjusted ROA matches the reported ROA entirely.
- Overall Insights
- The data point to a period of volatility in both profitability and asset efficiency metrics. The sharp increases in net income and ROA during 2022-2023 suggest favorable operational performance or one-time gains during those years. Nonetheless, the subsequent declines in late 2024 highlight a reversal or normalization, implying potential challenges or changing conditions affecting financial returns. The consistency between reported and adjusted figures indicates a lack of significant accounting adjustments or extraordinary items affecting these key measures.