Analog Devices Shares Rocket Higher Following Barclays Upgrade

Shares of Analog Devices, Inc. (NASDAQ: ADI) are up about 9.5 percent on Monday's midday, following Barclays' analyst Blayne Curtis and Equity Research Associate Christopher Hemmelgarn upgrade from Equal-weight to Overweight. They also raised the price target from $55 to $70.

What's Going On

According to the report, Barclays believes Analog Devices has secured multiple sockets across Apple Inc. (NASDAQ: AAPL)'s iPhone/iPad lineup to enable the 3D/Force Touch feature.

"ADI has always said it would be opportunistic in consumer and we believe AAPL needs and would be willing to pay for ADI's high accuracy converters," the representatives explained. They said they see 3D-touch starting in the iPhone 6S, and expect iPads to follow in 2016.

Related Link: This Little-Known Company Could Benefit From Apple For Years To Come

They estimate $0.80+ in incremental EPS in 2016, with the tailwind extending into the following year.

They also see "a roadmap for sustained content as multi-chip solutions in iPads are replaced by a single chip, and even integrate the 2D capacitive touch inputs in later generations."

Looking From A Step Back

Beyond Apple, Analog Devices seems well positioned. The Hittite Microwave LLC (NASDAQ: HITT) merger has provided, and is expected to continue to provide, upside on both the revenue and cost side.

Finally, the analysts note that the company "is seeing continued strength in the Industrial and likely sees an acceleration in Automotive (regain lost share in sensors, new content)."