Analog Devices, (NASDAQ:ADI) is a key supplier of analog and DSP integrated circuits. ADI have solid standing in the markets like industrial, auto and communication. Furthermore its merchandises endure very strong deployment in the developing automotive market. For Analog Devices, Apple Inc. (AAPL) the maker of flagship iPhones, is one of its biggest customers.
Analog Devices said in a statement that it will take over Linear Technology in a cash and stock agreement valued at $14.8 billion. The transaction is estimated to close in the first half of 2017. That will make Analog Devices an industry front-runner across an enormous range of products, customer extent and scale. The deal will help the company to nurture meaningfully in industrial, automotive, and communications infrastructure markets.
Furthermore the deal is expected to be instantly accretive to the company’s bottom line results. Additionally, the company anticipates annualized cost interactions of $150 million within the first 18 months following the close of the deal.
Although its investments are intended to strengthen the product line and defying rising rivalry, the strategy of returning cash through dividends and share buybacks is likely to ensure investor faithfulness.
In the last quarter, Analog Devices posted an earnings of $296.2 million, or 95 cents a share, up from $96.3 million, or 30 cents a share, year over year.
Exclusive of special charges and other items, per-share earnings were $1.05. Meanwhile its revenue surged 2.5% to $1 billion.
Analysts were predicting adjusted per-share earnings of 89 cents on revenue of $943 million.
For the current three month period, the company gave an outlook of adjusted per-share earnings of 68 cents to 78 cents, and revenue of $840 million to $900 million. However Analysts are forecasting per-share profit of 73 cents and revenue of $843.3 million.