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Analog Devices (ADI) & UnitedSiC Team Up for SiC Products

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Analog Devices, Inc. (ADI - Free Report) and UnitedSiC have entered into a long-term supply agreement for SiC Products. However, the terms of the supply agreement are not yet announced.

UnitedSiC is a semiconductor company that develops high-efficiency silicon carbide (SiC) devices and diode power semiconductors. It delivers SiC efficiency and performance for electric vehicle (EV) chargers, DC-DC converters, traction drives, among others.

Analog Devices has been collaborating with UnitedSiC on SiC-based products and devices for more than two years. The current deal will likely strengthen Analog Devices’ analog power portfolio.

Steve Pietkiewicz, Senior VP of Power Products at ADI said, "For the last few years, we have been actively following the development and progress of silicon carbide technology and devices. We found UnitedSiC's FET technology to be ideally suited for ADI's high performance power platforms and our pursuit of additional high voltage applications."

Strong Growth Expected in SiC Market

According to research firm Yole Development, the SiC power market is anticipated to witness compound annual growth rate of 29%.Also, the research firm’s analysts forecast a $1.4 billion SiC power semiconductor market by 2023. The growth is driven by strong adoption of these SiC transistors and their penetration into different applications, especially automotive.

The strong growth projection should be encouraging for Analog Devices. With the future of SiC power market looking promising, we believe that the company is well positioned to take advantage of this trend.

Bottom Line

Analog Devices’ increased focus on innovation and operational execution is expected to bode well in the near term. The company continues to benefit from rising demand for semiconductor content in Automotive, Communications and Industrial markets.

Analog Devices boasts a well-functioning communications business. The build out of TD-LTE in China, 4G network densification activities in the United States, and expected deployments in Europe and emerging regions should benefit the communications segment in the near term, increasing the chances of market share gains.

However, declining usage of the company’s products in portable consumer applications is a major headwind. In the last reported quarter, the company recorded a 21% year-over-year decline in consumer revenues. Macro uncertainty and geopolitical fears are concerns, which might hurt its top line.

Analog Devices, Inc. Price and Consensus

 

Analog Devices, Inc. Price and Consensus | Analog Devices, Inc. Quote

Zacks Rank & Stocks to Consider

Analog Devices currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader technology sector include Expedia Group, Inc. (EXPE - Free Report) , AMETEK, Inc. (AME - Free Report) and Inphi Corporation , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Long-term earnings growth rate for Expedia, AMETEK and Inphi is projected at 13.4%, 9.6% and 28.4%, respectively.

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