Munger Mode rating: 3 out of 5 — Hold. Our own rating from the research report below, on business quality first: moat durability and management, with price separating the top three.
The one-paragraph verdict: This is a wonderful business — one of the ten or fifteen genuinely great franchises in all of semiconductors — trading at a premium price. ADI just printed the best quarter in its 61-year history: $4.02 billion of revenue, up 40%, with adjusted operating margins of 50%. But we are being asked to pay roughly 29 times this year's adjusted earnings, and closer to 35 times what we'd call normalized mid-cycle earnings, at what is visibly the sweet spot of a cyclical recovery amplified by an AI construction boom. The moat is real and the management is able, which is why this isn't a sell. The price is ahead of intrinsic value, which is why it isn't a buy. If we owned it, we'd hold it happily. We would not initiate here. Charlie always said the first question is whether you can understand the business. This one we can, and we like what we understand.
Recent filings analysed: 8-K (2026-09-17), FWP (2026-09-16), 8-K (2026-09-09), 8-K (2026-08-19).
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