Analog Devices Inc. (NASDAQ:ADI)

Asset Turnover

The reported and adjusted total asset turnover ratios experienced a decline from 2019 through 2021, reaching their lowest points at 0.14 and 0.15 respectively in 2021. Both ratios then improved in 2022 and 2023, rising back to approximately 0.24-0.26, before decreasing again in 2024 to 0.20. This trend suggests fluctuating efficiency in using assets to generate revenue, with a notable recovery after 2021 that was not sustained in the most recent period.

Current Ratio

Both reported and adjusted current ratios showed a general upward trend from 2019 through 2022, improving from around 1.3 to just over 2.0, indicating an enhancement in short-term liquidity. However, this was followed by a sharp decline in 2023 to approximately 1.37-1.43, before recovering again in 2024 to levels similar to 2020 (around 1.84-1.85). The fluctuations reflect variability in the company’s ability to cover short-term obligations.

Debt to Equity and Debt to Capital

The debt to equity ratio (both reported and adjusted) significantly decreased from 2019 to 2021, moving from approximately 0.47-0.48 down to 0.18, and then slightly increased to about 0.20-0.22 by 2024. Similarly, debt to capital decreased from around 0.32 in 2019 to 0.15 in 2021 and saw a modest rise to about 0.17-0.18 by 2024. These patterns indicate a reduction in leverage up to 2021, followed by a mild increase, suggesting a cautious approach to debt financing over the period.

Financial Leverage

Reported and adjusted financial leverage ratios declined steadily from 2019 through 2021, falling from approximately 1.83 and 1.64 respectively to around 1.38 and 1.26. The ratios then remained relatively stable through 2024, fluctuating slightly around 1.37 to 1.29. This stability after the decline implies a consistent capital structure with moderate leverage in recent years.

Net Profit Margin

Both reported and adjusted net profit margins decreased from 2019 to 2021, with reported margins falling from about 22.75% to 19% and adjusted margins dropping more sharply from 20% to 14%. Subsequently, margins increased in 2022 and 2023, peaking at nearly 27% reported and 24% adjusted in 2023. However, there was a pronounced decline in 2024, falling to approximately 17.35% reported and 12.12% adjusted. This volatility suggests challenges in maintaining profitability, with a strong rebound period followed by a substantial margin compression in the latest year.

Return on Equity (ROE)

Reported and adjusted ROE both declined sharply from 2019 through 2021, dropping from around 11.64% and 9.75% respectively to low levels near 3.66% and 2.58%. Thereafter, a mild recovery occurred through 2023, with ROE reaching near 9.32% reported and 8.09% adjusted, before decreasing again in 2024 to roughly 4.65% reported and 3.20% adjusted. The trend signals fluctuating effectiveness in generating shareholder returns, heavily impacted during the middle years and only partially recovering before weakening again.

Return on Assets (ROA)

The reported and adjusted ROA followed a similar pattern to ROE, decreasing from around 6.37% and 5.93% in 2019 to their lowest points in 2021 at approximately 2.66% and 2.05%. Subsequently, ROA improved through 2023, reaching roughly 6.79% reported and 6.36% adjusted, but declined significantly in 2024 to 3.39% and 2.48%. These figures reinforce the observations regarding the company's profitability challenges and asset utilization efficiency over this period.

Revenue Trends

Revenue experienced a decline from 2019 through 2020, dropping from approximately 5.99 billion to 5.60 billion US dollars. This was followed by a notable increase reaching a peak of about 12.01 billion in 2022. Revenue then slightly increased in 2023 to roughly 12.31 billion before declining significantly in 2024 to approximately 9.43 billion. Overall, revenue showed volatility with a peak in the middle years and a downward movement in the latest period.

Total Assets Analysis

Total assets remained relatively stable between 2019 and 2020, around 21.4 billion US dollars. A substantial increase occurred in 2021, more than doubling to approximately 52.3 billion, followed by a gradual decrease over the next three years, reaching about 48.2 billion by 2024. The pattern suggests a major asset acquisition or revaluation event in 2021, with subsequent consolidation or depreciation impacting the total asset base thereafter.

Reported Total Asset Turnover

The reported total asset turnover ratio showed a declining trend from 0.28 in 2019 to a low of 0.14 in 2021, indicating reduced efficiency in generating revenue from assets during this period of asset growth. A recovery occurred in 2022 and 2023 with ratios rising to 0.24 and 0.25 respectively, implying improved utilization of assets. However, a decline to 0.20 in 2024 suggests a renewed decrease in asset efficiency.

Adjusted Total Assets and Turnover

Adjusted total assets mirrored the trends of total assets but at slightly lower values, indicating adjustments possibly for intangible or non-operating assets. The adjusted asset base increased sharply in 2021 and then gradually decreased through to 2024. Corresponding adjusted total asset turnover ratios followed a similar pattern to reported turnover, decreasing sharply in 2021, recovering over the next two years, and falling again in 2024. This consistency supports the observations on asset utilization efficiency.

Overall Insights

The data indicates a period of significant growth in asset base around 2021, which was not immediately matched by proportional revenue growth, resulting in a drop in asset turnover ratios. Subsequent periods show efforts to improve asset utilization, evidenced by rising turnover ratios in 2022 and 2023. The decline in both revenue and asset turnover in 2024 points to potential challenges in maintaining operational efficiency or market conditions adversely impacting performance. The substantial fluctuations over the years highlight the impact of strategic or external factors on financial dynamics.

The financial data reveals notable fluctuations in several key liquidity indicators over the analyzed periods. Current assets exhibit an overall upward trend, increasing from approximately $1.99 billion in late 2019 to about $5.48 billion in early 2024, with some volatility in the interim years. A peak is observed around 2021 followed by a decline in 2023 before rising again in 2024.

Current liabilities show greater variability, increasing overall from around $1.51 billion in 2019 to nearly $3.0 billion by 2024. There is a significant jump in liabilities between 2020 and 2021, preceding a slight decrease in 2022, then climbing again in 2023 before a modest reduction in 2024.

The reported current ratio, reflecting liquidity by comparing current assets to current liabilities, generally improves from 1.32 in 2019 to a high near 2.02 in 2022. However, this ratio dips substantially to 1.37 in 2023 before recovering to 1.84 in 2024. This indicates that liquidity remained strong through 2022 but weakened notably in 2023 before partially rebounding.

The adjusted figures for assets and liabilities, which likely account for refinements or reclassifications, mirror the trends observed in the reported data. Adjusted current assets increase consistently with minor fluctuations, and adjusted current liabilities rise correspondingly. The adjusted current ratio follows a similar pattern to the reported ratio, expanding from 1.38 in 2019 to a peak of 2.07 in 2022, declining to 1.43 in 2023, and rising again to 1.85 in 2024.

Overall, the assessment shows improving liquidity from 2019 to 2022, as indicated by increasing current ratios and growing current assets relative to liabilities. The dip in 2023 suggests a temporary tightening of liquidity, which partially recovers in 2024. The changes in liabilities indicate an increased reliance on short-term obligations, particularly around 2021 and 2023, which impacts the liquidity ratios. The company's ability to maintain current ratios above 1.3 throughout the period suggests a generally sound liquidity position despite the fluctuations.

Current Assets

Increased overall with peaks and troughs, highest value near $5.48 billion in 2024.

Current Liabilities

More variable with substantial increases in 2021 and 2023, ending near $3.0 billion in 2024.

Reported Current Ratio

Improved steadily until 2022, dropped significantly in 2023, partial recovery in 2024.

Adjusted Measures

Consistent with reported data trends, showing similar liquidity pattern and ratios.

Liquidity Trend

Generally improving until 2022, with a temporary liquidity contraction in 2023, followed by recovery.

Total Debt

The total debt exhibits notable fluctuations over the analyzed period. Initially, it decreases from approximately 5.49 billion USD in late 2019 to about 5.15 billion USD in late 2020. However, from 2020 onwards, a rising trend is observed, with total debt increasing to around 6.77 billion USD by late 2021. This level stabilizes somewhat in 2022 before resuming growth, reaching approximately 7.58 billion USD by late 2024.

Shareholders’ Equity

Shareholders' equity demonstrates a strong expansion from 2019 through 2021, surging from approximately 11.71 billion USD to nearly 38 billion USD. This is followed by a gradual decline across the subsequent three years, dropping to approximately 35.18 billion USD by late 2024. Despite this decrease, equity remains significantly elevated relative to the initial period.

Reported Debt to Equity Ratio

The reported debt to equity ratio decreases substantially from 0.47 in 2019 to 0.18 in late 2021, indicating a considerable improvement in leverage and a strengthening equity base relative to debt. From 2021 onwards, the ratio stabilizes and then experiences a slight increase, reaching 0.22 by late 2024, suggesting a modest increase in leverage during the latter period.

Adjusted Total Debt

The adjusted total debt generally follows a trend similar to that of reported total debt. It decreases initially from approximately 5.87 billion USD in late 2019 to about 5.47 billion USD in late 2020. After this decline, adjusted debt consistently rises, culminating at nearly 7.97 billion USD by late 2024, reflecting a growth trend in adjusted liabilities during the latter years.

Adjusted Shareholders’ Equity

Adjusted shareholders' equity mirrors the reported equity pattern with strong growth from roughly 12.29 billion USD in 2019 to nearly 39.71 billion USD in 2021. Following this peak, a gradual decline is observed toward approximately 35.74 billion USD by late 2024, indicating some reduction in adjusted equity despite remaining substantially higher than at the beginning of the period.

Adjusted Debt to Equity Ratio

The adjusted debt to equity ratio decreases sharply from 0.48 in 2019 to 0.18 in late 2021, consistent with improving leverage metrics driven by stronger equity growth relative to debt. Similar to the reported ratio, a slight upward movement occurs after 2021, reaching 0.22 in late 2024, suggesting increased leverage but still maintaining relatively low levels compared to the initial years.

Analysis of the financial data reveals significant shifts in debt and capital structure over the periods examined.

Total Debt

The total debt exhibited a fluctuating trend, initially decreasing from approximately 5.49 billion in late 2019 to around 5.15 billion in 2020. This was followed by an increase reaching nearly 6.77 billion in 2021. Subsequently, the debt level slightly declined in 2022 before rising again in the latest years, peaking at approximately 7.58 billion in 2024. Overall, total debt demonstrates an upward trajectory in the latter years after an earlier decrease.

Total Capital

Total capital remained relatively stable around 17 billion through 2019 and 2020. However, a marked increase occurred in 2021, with capital more than doubling to approximately 44.76 billion. After this sharp rise, total capital experienced a slight decline during 2022 and 2023, settling just above 42.5 billion, with a minor uptick by 2024 to approximately 42.76 billion. This indicates a significant capital structure change starting from 2021.

Reported Debt to Capital Ratio

The reported debt to capital ratio declined substantially from 0.32 in 2019 to 0.3 in 2020, then further dropped to 0.15 in 2021 and held steady at this level in 2022. In the most recent years, it increased modestly to 0.16 in 2023 and 0.18 in 2024. The overall pattern suggests improved leverage control initially with a low and stable ratio, followed by a slight increase in debt reliance relative to capital in the latter periods.

Adjusted Total Debt

Adjusted total debt follows a similar pattern to total debt, decreasing from about 5.87 billion in 2019 to 5.47 billion in 2020, then rising steadily through the years to reach 7.97 billion in 2024. This confirms the trend of increasing adjusted debt in recent years.

Adjusted Total Capital

Adjusted total capital shows a consistent pattern with total capital, with a modest decline from roughly 18.16 billion in 2019 to 17.96 billion in 2020, followed by a substantial increase to 46.83 billion in 2021. Afterward, it decreased to about 43.82 billion in 2022 and further reduced to around 43.99 billion in 2023, with a slight decrease to 43.71 billion in 2024. This reflects the significant capital growth starting in 2021 and subsequent slight reductions.

Adjusted Debt to Capital Ratio

This ratio closely mirrors the reported debt to capital ratio, starting at 0.32 in 2019 and dipping to 0.3 in 2020. It then sharply declines to 0.15 in 2021 and remains at that level in 2022. The ratio rises to 0.17 in 2023 and 0.18 in 2024, indicating a recent increase in adjusted leverage.

In summary, the data depicts an initial phase of debt reduction and capital stability, followed by a substantial increase in capital base beginning in 2021, which significantly lowered leverage ratios. Despite this, the last couple of years reveal a gradual increase in both debt and debt-to-capital ratios, suggesting a modest shift toward higher leverage while maintaining a relatively strong capital position.

The analysis of the financial data over the six-year period reveals several notable trends and patterns relating to the company's asset base, equity position, and leverage ratios.

Total Assets

The total assets exhibited a significant increase from 21.39 billion US dollars in 2019 to over 52.32 billion in 2021, followed by a gradual decline in subsequent years to approximately 48.23 billion by 2024. This indicates a peak in asset accumulation in 2021, with a downward adjustment in the asset base thereafter.

Shareholders’ Equity

Shareholders’ equity showed a similar pattern, rising sharply from about 11.71 billion USD in 2019 to nearly 38 billion USD in 2021. Subsequent years displayed a gradual reduction, ending at around 35.18 billion USD in 2024. This trend parallels the fluctuations in total assets, suggesting adjustments in retained earnings or capital structure following the peak year.

Reported Financial Leverage

The reported financial leverage ratio decreased from 1.83 in 2019 to 1.38 in 2021, and then remained relatively stable around 1.37 through 2024. This decline implies that the company's reliance on debt relative to equity lessened considerably by 2021 and stabilized at a lower leverage level, indicating a stronger equity base relative to total assets.

Adjusted Total Assets

Adjusted total assets mirrored the trend seen in total assets, decreasing slightly in the early years before a substantial rise to approximately 50.06 billion USD in 2021, followed by a decline to about 46.15 billion USD by 2024. This pattern confirms the asset peak and subsequent decrease observed in the unadjusted figures, though adjusted values remain consistently lower, possibly reflecting different valuation or accounting criteria.

Adjusted Shareholders’ Equity

Adjusted shareholders’ equity increased steadily from 12.29 billion USD in 2019 to nearly 39.71 billion USD in 2021 but diminished gradually thereafter to roughly 35.74 billion USD in 2024. The pattern is consistent with the raw equity data, supporting interpretations of equity growth until 2021 and moderate reduction following that year.

Adjusted Financial Leverage

The adjusted financial leverage ratio followed a decreasing trend from 1.64 in 2019 to approximately 1.26 in 2021, remaining stable in the following years with a slight increase to 1.29 by 2024. This indicates a reduction in financial leverage over time, with a minor uptick toward the end of the period, potentially reflecting changes in asset or equity adjustments.

In summary, the data suggest an expansion phase culminating in 2021, characterized by significant growth in both assets and shareholders’ equity, accompanied by a reduction in leverage ratios. Post-2021, the company appears to have undergone a period of contraction or recalibration, with declining asset and equity values and relatively stable yet slightly increasing adjusted financial leverage. This could indicate strategic asset divestment, changes in capital structure, or other financial adjustments impacting the balance sheet composition.

The data reflect fluctuating financial performance over the six-year period, showing notable variations in income, revenue, and profit margins.

Net Income

The net income exhibits an overall upward trend from 2019 through 2023, increasing from approximately 1.36 billion USD in 2019 to a peak of 3.31 billion USD in 2023. However, in 2024, net income declines sharply to about 1.64 billion USD, nearly halving compared to the previous year.

Revenue

Revenue follows a similar trajectory with an initial decrease from 5.99 billion USD in 2019 to 5.60 billion USD in 2020, followed by substantial growth each subsequent year, reaching a high of approximately 12.31 billion USD in 2023. In 2024, revenue declines significantly to roughly 9.43 billion USD, indicating a contraction in sales or market demand compared to the previous two years.

Reported Net Profit Margin

The reported net profit margin gradually decreases from 22.75% in 2019 to 19.00% in 2021, before improving to 26.94% in 2023, which is the highest margin recorded in the period. In 2024, the margin decreases noticeably to 17.35%, which is below the levels seen in 2019 and 2020, suggesting lower profitability relative to revenue in the most recent year.

Adjusted Net Income

Adjusted net income declines steadily from about 1.20 billion USD in 2019 to just over 1.03 billion USD in 2021, then rises sharply to 2.41 billion USD in 2022 and further to 2.96 billion USD in 2023. This measure drops drastically in 2024 to approximately 1.14 billion USD, mirroring the pattern observed in reported net income but representing a more conservative earnings assessment after adjustments.

Adjusted Net Profit Margin

The adjusted net profit margin decreases from 19.99% in 2019 to a low of 14.01% in 2021. It then recovers to 24.07% in 2023, indicating improved operational efficiency or favorable adjustments. The margin falls again in 2024 to 12.12%, the lowest point in the recorded period, signaling a significant decline in underlying profitability.

In summary, the company experienced significant growth in both revenue and net income through 2023, accompanied by improving profit margins. The subsequent decline in 2024 across all key financial metrics suggests challenges such as reduced sales volume, increased costs, or other adverse factors impacting profitability. The disparity between reported and adjusted figures highlights volatility in earnings components subject to adjustment, particularly pronounced in recent years.

Net Income

The net income shows a fluctuating trend over the periods. Starting at approximately $1.36 billion in November 2019, it declined to about $1.22 billion in October 2020. It then increased moderately to nearly $1.39 billion in October 2021, followed by a significant jump to approximately $2.75 billion in October 2022 and further to $3.31 billion in October 2023. However, in the latest period ending November 2024, net income decreased sharply to about $1.64 billion.

Shareholders’ Equity

Shareholders’ equity experienced a substantial rise from $11.7 billion in November 2019 to around $38 billion in October 2021, representing more than a threefold increase. Subsequently, it declined slightly over the next three years, decreasing to about $36.5 billion in October 2022, $35.6 billion in October 2023, and further to approximately $35.2 billion in November 2024.

Reported Return on Equity (ROE)

The reported ROE exhibits variable performance. It decreased from 11.64% in November 2019 to 10.17% in October 2020, followed by a sharp decline to 3.66% in October 2021. Afterward, it improved to 7.54% in October 2022 and 9.32% in October 2023, before dropping again to 4.65% in the latest period.

Adjusted Net Income

The adjusted net income follows a pattern similar to net income, starting at approximately $1.20 billion in November 2019 and declining steadily to about $1.03 billion in October 2021. It then experienced a sharp increase to nearly $2.42 billion in October 2022 and further to $2.96 billion in October 2023. In November 2024, it dropped significantly to about $1.14 billion.

Adjusted Shareholders’ Equity

Adjusted shareholders’ equity mirrors the trend of reported equity, growing from roughly $12.3 billion in November 2019 to approximately $39.7 billion in October 2021. Afterwards, it gradually decreased to $37.9 billion in October 2022, to $36.6 billion in October 2023, and then to $35.7 billion in November 2024.

Adjusted ROE

Adjusted ROE shows a declining trend in the early years from 9.75% in November 2019 to 8.4% in October 2020, followed by a sharp fall to 2.58% in October 2021. It improves to 6.39% in October 2022 and to 8.09% in October 2023, then declines again to 3.2% in November 2024.

Overall, the data indicate periods of significant growth in both net income and equity, notably between 2020 and 2021, after which both metrics stabilize or decline slightly. The return on equity metrics reflect volatility, with sharp declines observed around 2021 followed by partial recoveries and subsequent decreases in the latest period. The adjusted figures follow a consistent pattern with the reported ones, confirming similar trends when accounting for adjustments.

Net Income

Net income experienced fluctuations over the periods analyzed. After a decline from approximately 1.36 billion to 1.22 billion between 2019 and 2020, it increased to around 1.39 billion in 2021. The most significant rise occurred in 2022 and 2023, reaching a peak of about 3.31 billion in 2023. However, in 2024, net income decreased markedly to approximately 1.64 billion.

Total Assets

Total assets remained relatively stable from 2019 to 2020, around 21.4 billion. A substantial increase occurred in 2021, with assets more than doubling to over 52.3 billion. This higher asset base slightly declined each year thereafter, standing at roughly 48.2 billion by 2024.

Reported Return on Assets (ROA)

The reported ROA exhibited variability, starting at 6.37% in 2019, decreasing to 5.69% in 2020, and dropping more steeply to 2.66% in 2021. It rebounded strongly in 2022 and 2023, reaching 6.79%. In 2024, it dropped again to 3.39%, reflecting diminished profitability relative to the total asset base.

Adjusted Net Income

Adjusted net income followed a pattern similar to net income. It declined from nearly 1.20 billion in 2019 to about 1.05 billion in 2020 and 1.03 billion in 2021. A sharp increase took place in 2022 and 2023, peaking at approximately 2.96 billion. However, it fell significantly to 1.14 billion in 2024.

Adjusted Total Assets

Adjusted total assets showed a steady trend comparable to total assets, starting at about 20.2 billion in 2019, slightly decreasing to 19.97 billion in 2020, and then sharply rising to 50.1 billion in 2021. Subsequently, there was a gradual reduction to about 46.2 billion by 2024.

Adjusted Return on Assets (ROA)

Adjusted ROA declined from 5.93% in 2019 to 5.25% in 2020 and sharply decreased to 2.05% in 2021. The ratio recovered in 2022 and 2023, reaching 6.36%, before falling to 2.48% in 2024. This indicates that profitability, relative to adjusted assets, experienced notable volatility.

Overall, the financial data reveals a cycle of contraction and expansion in income, with a pronounced asset base increase in 2021 followed by moderate declines. Profitability ratios suggest oscillating efficiency in utilizing assets to generate returns, peaking in the mid-period before dropping significantly in the most recent year assessed.