Adeia Inc. (ADEA)
Valuation Overview•Is Adeia Inc. Overvalued or Undervalued?
Priced at a premium to peer multiples and intrinsic cash flows, demanding strong execution to justify current levels.
High-quality fundamentals with a strong composite quality score of 78/100, backed by robust profitability and solvency.
Wall Street forecasts a balanced outlook with consensus price targets near the current price.
Verdict: Solid fundamental quality, though solvency presents a headwind.
Wall Street is broadly bullish, projecting solid upside alongside robust expected earnings growth. However, capital return yields remain modest, driven predominantly by aggressive share repurchases.
ADEA exhibits elite business quality, driven by exceptional capital efficiency and highly lucrative margins. This is paired with a moderately leveraged but stable balance sheet.
The company exhibits steady, low-single-digit revenue growth paired with stable bottom-line earnings. This growth is supported by elite operational efficiency, sustaining an impressive 46.3% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $104.8M | +17.9% | +0.3% | -13.0% | +5.0% | |
| EBITDA | $57.2M | — | -1.0% | — | — | |
| Net Income | $22.8M | +71.9% | — | — | -0.5% | |
| EPS (Diluted) | $0.20 | +73.7% | — | -10.8% | -7.8% | |
| Free Cash Flow | $58.1M | -21.5% | -4.3% | -16.6% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 67.8% | 81.1% | 75.4% | 73.1% |
| Operating Margin | 46.3% | 40.8% | 32.4% | 22.7% |
| Net Margin | 26.5% | 19.9% | -2.8% | -1.4% |
| FCF Margin | 33.8% | 40.6% | 37.2% | 40.4% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $0.33 | $0.38 | +15.7% | ||
| Q1'26 | $0.65 | $0.86 | +32.1% | ||
| Q4'25 | $0.36 | $0.28 | -22.2% | ||
| Q3'25 | $0.24 | $0.25 | +4.2% | ||
| Q2'25 | $0.26 | $0.26 | +0.0% | ||
| Q1'25 | $0.42 | $0.47 | +11.9% | ||
| Q4'24 | $0.35 | $0.27 | -22.9% | ||
| Q3'24 | $0.23 | $0.28 | +21.7% |
Total return is +145.1% (1Y), outperforming the benchmark by +120.1%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +81.5% | +72.2% | — |
| 1Y | +145.1% | +120.1% | +1.5% |
| 3YCAGR | +44.3% | +24.2% | +5.6% |
| 5YCAGR | +42.0% | +28.0% | +17.6% |
| 10YCAGR | +15.8% | +2.2% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Adeia Inc. (ADEA) valuation, health, and returns.
Adeia Inc. is estimated to be overvalued under our discounted cash flow framework. relative multiples indicate the stock is Slightly expensive versus peers compared to industry peers. overvalued (implying -23.2% downside from DCF intrinsic value of $24.44)
Adeia Inc. has multiple valuation anchors: DCF Intrinsic Value: $24.44 | Peer Relative Fair Value: $26.83 | Wall Street Analyst Target: $34.50 (implying +8.5% upside). A convergence of these signals offers higher conviction.
Adeia Inc. displays good financial health with a composite quality score of 78/100, supported by a Altman Z-Score of 4.7 (safe zone), Piotroski F-Score of 9/9, Return on Invested Capital (ROIC) of 19.0%.
Adeia Inc. pays a 0.6% dividend yield, covered by a 20% payout ratio with 0 years of growth, supplemented by a 1.2% buyback yield.
Adeia Inc.'s current growth trajectory is Accelerating. The company achieved +17.9% 1Y revenue growth and +73.7% 1Y EPS growth, compared to its 3Y revenue CAGR of +0.3%.
Wall Street consensus is Buy based on 5 analysts, beating EPS expectations in 75% of recent quarters with a 2-quarter streak. The consensus price target represents a +8.5% change from current levels.
Investment risks for Adeia Inc. include: -34.8% 1-year max drawdown, high beta (2.13x market volatility). Volatility risk is characterized by a beta of 2.13x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.