Analog Devices, Inc.

The forensic scores point in different directions, and a careful reader should weigh them together rather than in isolation. The Beneish M-Score is -2.791, which is below the -1.78 threshold, so it is not in the elevated manipulation-risk zone. This is a statistical screen, and a score outside the zone is not proof that reported figures are accurate. The operating cash flow to net income ratio of 2.12 means operating cash flow of $4.81 billion against net income of $2.27 billion for fiscal 2025. Reported profit is backed by more cash than the income statement alone shows, which is usually read as a constructive sign. The Piotroski F-Score is 8 of 9 computable signals, a checklist of profitability, leverage and efficiency tests in which most signals passed. The Altman Z-Score of 0.79 falls in the distress zone, below 1.81. The Altman model blends working capital, retained earnings, operating earnings, equity relative to liabilities, and sales relative to assets. It was built largely around manufacturing firms, so a reader should treat this result with caution rather than as a forecast of financial trouble. Business-level detail matters too. In the 10-Q, Automotive revenue grew only 8% to $794.4 million while Industrial and Communications grew far faster, and the company recorded a $15.6 million impairment on an asset group in its leased San Jose facilities. Distributors supplied 55% of first-quarter revenue, which is relevant given the filings' cautions about independent distributor performance. Readers may want to look at the Item 1A discussion of tariffs, export classifications, and indebtedness in the fiscal 2025 10-K.

Catalyst.According to the 10-Q for the quarter ended January 31, 2026, revenue rose 30% to $3.16 billion from $2.42 billion a year earlier, and net income more than doubled to $830.8 million, up 112%. Management ties the growth to broad-based demand, notably the wireline sub-market of Communications that supports datacenter expansion, where revenue rose 63% to $476.8 million. Industrial revenue grew 38% to $1.49 billion, with test equipment cited as a driver. Gross margin widened to 64.7% from 59.0%, which management attributes mainly to higher factory utilization and favorable product mix. For fiscal 2025, revenue grew 16.9% to $11.02 billion.

Hidden risk.The fiscal 2025 figures produce an Altman Z-Score of 0.79, which falls in the distress zone, even as reported profits recovered. The score is a screening model and does not prove financial trouble, but under its thresholds it signals a balance sheet that weighs against the company. Long-term debt rose from $6.63 billion at the end of fiscal 2024 to $8.15 billion at the end of fiscal 2025, an increase of about 23%, while total equity fell to $33.82 billion from $35.18 billion. The forward-looking statement list in the filings also cites tariffs, export classification changes, and risks related to indebtedness, so the strong recent quarter may not persist.