Is Analog Devices, Inc. overvalued or undervalued?

As of 30 June 2025, the valuation grade for Analog Devices, Inc. has moved from expensive to very expensive, indicating a significant concern regarding its current pricing relative to its earnings potential. The company appears to be overvalued, with a P/E ratio of 58, an EV to EBITDA of 26.33, and a Price to Book Value of 3.15. In comparison to peers, NVIDIA Corp. has a more attractive P/E ratio of 47.72, while Broadcom Inc. is even more expensive at 82.00.
Despite its strong historical performance, Analog Devices, Inc. has underperformed relative to the S&P 500 over the past year, with a return of 11.86% compared to the index's 17.14%. This underperformance, coupled with its high valuation ratios, reinforces the view that the stock is currently overvalued.