Head to Head Contrast: Astera Labs (NASDAQ:ALAB) & Analog Devices (NASDAQ:ADI)

Analog Devices (NASDAQ:ADI) and Astera Labs (NASDAQ:ALAB) are both large-cap technology companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, profitability, dividends, institutional ownership, valuation, analyst recommendations and earnings.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Analog Devices and Astera Labs, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Analog Devices	0	3	29	1	2.94
Astera Labs	0	10	13	0	2.57

Analog Devices presently has a consensus target price of $460.55, suggesting a potential upside of 12.58%. Astera Labs has a consensus target price of $320.85, suggesting a potential upside of 38.95%. Given Astera Labs’ higher probable upside, analysts clearly believe Astera Labs is more favorable than Analog Devices.

Volatility & Risk

Analog Devices has a beta of 1.24, indicating that its share price is 24% more volatile than the S&P 500. Comparatively, Astera Labs has a beta of 3.85, indicating that its share price is 285% more volatile than the S&P 500.

Insider and Institutional Ownership

86.8% of Analog Devices shares are owned by institutional investors. Comparatively, 60.5% of Astera Labs shares are owned by institutional investors. 0.4% of Analog Devices shares are owned by company insiders. Comparatively, 10.4% of Astera Labs shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Analog Devices and Astera Labs”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Analog Devices	$11.02 billion	17.99	$2.27 billion	$8.43	48.53
Astera Labs	$852.53 million	47.34	$219.13 million	$2.51	92.00

Analog Devices has higher revenue and earnings than Astera Labs. Analog Devices is trading at a lower price-to-earnings ratio than Astera Labs, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Analog Devices and Astera Labs’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Analog Devices	29.79%	16.39%	11.49%
Astera Labs	29.64%	25.35%	22.48%

Summary

Analog Devices beats Astera Labs on 8 of the 15 factors compared between the two stocks.

About Analog Devices

Analog Devices, Inc. designs and manufactures semiconductor products that help customers sense, measure, interpret and process real-world signals. Its offerings include analog and mixed-signal integrated circuits, power management products, radio-frequency technology, sensors and digital signal processing solutions. The company’s products are used in industrial automation, automotive systems, communications infrastructure, healthcare equipment, consumer devices and aerospace and defense applications.

About Astera Labs

Astera Labs, Inc. is a fabless semiconductor company that develops connectivity solutions for cloud and artificial intelligence infrastructure. Its products are designed to help move data among processors, accelerators, memory and other components in high-performance computing systems. The company’s portfolio includes Aries PCIe and CXL retimers, Taurus Ethernet smart cable modules, Scorpio fabric switches and Leo CXL memory connectivity controllers. Astera Labs also offers software tools to help customers configure and monitor its connectivity products.