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Adeia
(NASDAQ:ADEA)
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Rating:72Outperform
Price Target:
$31.00
▲(19.46% Upside)
Action:Reiterated
Date:08/04/26
The score is driven primarily by strong financial performance (high margins, solid cash generation/earnings quality, and a currently de-levered balance sheet) and a constructive earnings update with reiterated guidance and raised long-term targets. Offsetting these strengths are mixed technical momentum (negative MACD and price below key mid-term averages) and a valuation that looks moderate-to-full (P/E ~23.8) with only a modest dividend yield.
Positive Factors
High Profitability & Cash Conversion
Sustained high operating and net margins, paired with FCF nearly matching net income, indicate durable earnings quality and cash generation. This supports reinvestment, M&A, dividends and buybacks without depending on volatile financing, improving long-term financial flexibility.
Negative Factors
Ongoing Litigation Exposure
Active and new litigation creates durable legal expense volatility, settlement or injunction risk, and uncertain timing for monetization of IP. Extended disputes can divert management time, increase costs, and delay expected licensing cash flows for multiple quarters or years.
Read all positive and negative factors
Positive Factors
Negative Factors
High Profitability & Cash Conversion
Sustained high operating and net margins, paired with FCF nearly matching net income, indicate durable earnings quality and cash generation. This supports reinvestment, M&A, dividends and buybacks without depending on volatile financing, improving long-term financial flexibility.
Read all positive factors
Adeia Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlyAdeia (ADEA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.94B
Dividend Yield0.75%
Average Volume (3M)1.56M
Price to Earnings (P/E)23.8
Beta (1Y)1.10
Revenue Growth21.09%
EPS Growth61.05%
CountryUS
Employees150
SectorGeneral
Sector StrengthN/A
IndustrySoftware - Application
Share Statistics
EPS (TTM)1.13
Shares Outstanding110,293,750
10 Day Avg. Volume1,186,925
30 Day Avg. Volume1,559,758
Financial Highlights & Ratios
PEG Ratio0.23
Price to Book (P/B)3.92
Price to Sales (P/S)4.25
P/FCF Ratio12.61
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$38.00Price Target Upside46.44% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)1.42
Revenue Forecast (FY)$417.06M
Adeia Business Overview & Revenue Model
Company Description
Adeia Inc. (ADEA) is an intellectual property (IP) licensing company that develops and licenses patented technologies used in the media and semiconductor industries. The company’s technology portfolio includes inventions related to digital media, ...
How the Company Makes Money
Adeia makes money primarily by monetizing its patent portfolio through licensing and related IP agreements. Its key revenue streams are: (1) recurring license royalties and/or fixed-fee license payments from companies that use Adeia’s patented tec...
Adeia Earnings Call Summary
Earnings Call Date:Aug 03, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 09, 2026
Earnings Call Sentiment Positive
The call conveyed strong operational and financial performance: healthy revenue and margin, robust cash generation, record new customers, meaningful diversification with non-Pay-TV recurring revenue up 54% YoY, semiconductor momentum and raised long-term targets. The primary negatives were timing and concentration risk tied to large deals, ongoing litigation and a sizable debt balance/interest expense, plus expected light cash generation in Q3 and a CEO succession process. Overall, the positive growth, cash generation, and strategic progress outweigh the challenges.Positive Updates
Revenue and Profitability in Q2
Revenue of $96.1 million in Q2 2026, adjusted EBITDA of $56.4 million and an adjusted EBITDA margin of 58.7%, all in line with expectations.
Negative Updates
Ongoing Litigation and Pay-TV Headwinds
Company faces Pay-TV industry headwinds and ongoing litigation (recently filed claims against Fubo); management noted timing of litigation resolution is difficult to predict and could impact short-term results.
Read all updates
Q2-2026 Updates
Positive
Negative
Revenue and Profitability in Q2
Revenue of $96.1 million in Q2 2026, adjusted EBITDA of $56.4 million and an adjusted EBITDA margin of 58.7%, all in line with expectations.
Read all positive updates
Company Guidance
Management reiterated 2026 revenue guidance of $395–$435 million and expects operating expenses of $184–$192 million, interest expense of $34–$36 million, other income of $5.5–$6.5 million, an adjusted EBITDA margin of ~55%, a non‑GAAP tax rate of 21% and capital expenditures of about $2 million; they also raised long‑term targets to $600 million in revenue (from $500M), with a $400M media objective and a $200M semiconductor target (up from $100M). For context, Q2 results were $96.1M of revenue, $56.4M adjusted EBITDA (58.7% margin), $54.6M cash from operations and $137.1M cash on hand; the term loan balance was $392.6M, the company repurchased ~353,000 shares for $10M (with ~$140M remaining authorization) and paid a $0.05/share dividend (another $0.05 payable Sept. 14). Management said the strong pipeline supports the reiterated guidance but noted timing of large license signings and litigation outcomes could influence near‑term results.Adeia Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
84
Very Positive
Cash Flow
80
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 470.87M | 443.39M | 376.02M | 388.79M | 438.93M | 877.70M |
| Gross Profit | 354.86M | 386.76M | 303.25M | 293.51M | 324.71M | 523.74M |
| EBITDA | 260.97M | 239.86M | 206.50M | 237.82M | 269.33M | 235.64M |
| Net Income | 122.68M | 111.08M | 64.62M | 67.37M | -295.88M | -55.46M |
Balance Sheet | ||||||
| Total Assets | 1.01B | 1.04B | 1.10B | 1.11B | 1.21B | 2.47B |
| Cash, Cash Equivalents and Short-Term Investments | 137.08M | 136.73M | 110.39M | 83.57M | 114.56M | 140.96M |
| Total Debt | 394.67M | 427.74M | 485.42M | 595.93M | 736.29M | 772.87M |
| Total Liabilities | 536.31M | 558.76M | 701.39M | 748.93M | 909.11M | 1.13B |
| Stockholders Equity | 477.19M | 480.54M | 396.57M | 356.62M | 301.41M | 1.35B |
Cash Flow | ||||||
| Free Cash Flow | 181.50M | 149.33M | 190.16M | 146.41M | 170.16M | 220.65M |
| Operating Cash Flow | 190.95M | 158.09M | 212.46M | 152.75M | 183.02M | 234.79M |
| Investing Cash Flow | -50.95M | -40.26M | -24.02M | -34.49M | -2.91M | -6.21M |
| Financing Cash Flow | -151.47M | -123.51M | -164.17M | -178.26M | -263.26M | -196.25M |
Adeia Technical Analysis
Positive
25.95
Price Trends
29.15
Positive
28.30
Positive
22.49
Positive
Market Momentum
-0.26
Negative
56.39
Neutral
85.47
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ADEA, the sentiment is Positive. The current price of 25.95 is below the 20-day moving average (MA) of 27.13, below the 50-day MA of 29.15, and above the 200-day MA of 22.49, indicating a bullish trend. The MACD of -0.26 indicates Negative momentum. The RSI at 56.39 is Neutral, neither overbought nor oversold. The STOCH value of 85.47 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ADEA.
Adeia Risk Analysis
Adeia disclosed 39 risk factors in its most recent earnings report. Adeia reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Adeia Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $1.66B | 19.42 | 18.16% | ― | 15.50% | 56.73% | |
72 Outperform | $2.94B | 23.78 | 26.70% | 0.77% | 21.09% | 61.05% | |
69 Neutral | $1.64B | -117.86 | 25.17% | ― | 15.79% | -125.94% | |
64 Neutral | $1.49B | 55.26 | 5.25% | ― | 8.10% | -73.21% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
55 Neutral | $699.12M | -9.02 | -9.11% | ― | 23.94% | -630.81% |
* General Sector Average
ADEA
Adeia
28.31
14.66
107.43%
PAR
Par Technology
17.12
-40.91
-70.50%
PRGS
Progress Software
41.81
-1.81
-4.15%
PRCH
Porch Group
15.44
0.55
3.69%
CXM
Sprinklr
6.61
-1.85
-21.87%
Adeia Corporate Events
Business Operations and StrategyExecutive/Board ChangesRegulatory Filings and Compliance
Adeia updates executive severance and equity vesting terms
Neutral
Jul 28, 2026
On July 22, 2026, Adeia Inc.’s compensation committee approved amendments to severance agreements for chief financial officer Keith A. Jones, chief revenue officer Dr. Mark Kokes and chief legal officer and secretary Kevin Tanji. The amended...
Legal Proceedings
Adeia Files Patent Infringement Lawsuit Against FuboTV
Negative
Jul 1, 2026
On July 1, 2026, Adeia announced that a wholly owned subsidiary filed a patent infringement lawsuit against FuboTV Inc. and certain subsidiaries in the U.S. District Court for the District of Delaware. The complaint alleges infringement of four U....
Business Operations and StrategyExecutive/Board ChangesRegulatory Filings and ComplianceShareholder Meetings
Adeia Shareholders Approve Governance, Compensation and Equity Plan
Positive
May 8, 2026
At its annual meeting held on May 7, 2026, Adeia stockholders re-elected seven directors to serve until the next annual meeting and approved, on an advisory basis, the compensation of the company’s named executive officers. Investors also ra...
Business Operations and StrategyExecutive/Board Changes
Adeia CEO Paul Davis Plans 2026 Leadership Transition
Neutral
May 4, 2026
Adeia Inc. announced on May 4, 2026, that chief executive officer Paul E. Davis intends to step down from his roles as CEO and board member by the fourth quarter of 2026 to prioritize his health and personal pursuits, though he will remain in plac...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.