Compare Analog Devices, Inc. (ADI) vs Texas Instruments Incorporated (TXN) Stock

Texas Instruments Incorporated (TXN) offers the better valuation at 38.9x trailing P/E (33.0x forward), making it the more compelling value choice. Analysts rate Analog Devices, Inc. (ADI) a "Buy" — based on 54 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, Texas Instruments Incorporated (TXN) is the cheapest at 38.9x versus Analog Devices, Inc. at 78.0x. On forward P/E, Analog Devices, Inc. is actually cheaper at 31.5x — notably different from the trailing picture, reflecting expected earnings growth.

Over the past 5 years, Analog Devices, Inc. (ADI) delivered a total return of +134.6%, compared to +33.5% for Texas Instruments Incorporated (TXN). A $10,000 investment in ADI five years ago would be worth approximately $23K today (assuming dividends reinvested). Over 10 years, the gap is even starker: ADI returned +621.4% versus TXN's +373.7%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), Texas Instruments Incorporated (TXN) is the lower-risk stock at 1.29β versus Analog Devices, Inc.'s 1.55β — meaning ADI is approximately 20% more volatile than TXN relative to the S&P 500. On balance sheet safety, Analog Devices, Inc. (ADI) carries a lower debt/equity ratio of 26% versus 86% for Texas Instruments Incorporated — giving it more financial flexibility in a downturn.

Texas Instruments Incorporated (TXN) is the more profitable company, earning 28.3% net margin versus 20.6% for Analog Devices, Inc. — meaning it keeps 28.3% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: TXN leads at 34.1% versus 26.6% for ADI. At the gross margin level — before operating expenses — ADI leads at 61.5%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

On forward earnings alone, Analog Devices, Inc. (ADI) trades at 31.5x forward P/E versus 33.0x for Texas Instruments Incorporated — 1.5x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for ADI: 5.2% to $374.42.

All stocks in this comparison pay dividends. Texas Instruments Incorporated (TXN) offers the highest yield at 2.6%, versus 1.1% for Analog Devices, Inc. (ADI).

For long-horizon retirement investors, Texas Instruments Incorporated (TXN) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 1.29), 2.6% yield, +373.7% 10Y return). Analog Devices, Inc. (ADI) carries a higher beta of 1.55 — meaning larger drawdowns in market downturns, which matters significantly when you cannot wait years for a recovery. Both have compounded well over 10 years (TXN: +373.7%, ADI: +621.4%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Technology sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.