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Texas Instruments to Reward Investors With 13% Dividend Hike
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Texas Instruments (TXN - Free Report) or TI recently announced a hike in dividend. The company plans to raise quarterly dividend by 12 cents to $1.02 per share. This translates to a 13% increase from the prior dividend of 90 cents.
The new dividend will be paid on Nov 16, 2020 to stockholders of record as of Oct 30, 2020, contingent upon a formal declaration by the board of directors at its regular meeting in October.
Texas Instruments Incorporated Price and Consensus
TI’s strong balance sheet and cash flow provide financial flexibility for dividend hikes, share repurchases and strategic acquisitions.
At the end of second-quarter 2020, its cash and short-term investments totaled $4.9 billion compared with $4.7 billion at the end of the prior quarter. Long-term debt was approximately $6.2 billion, up from $5.5 billion in the first quarter.
The company generated $1.7 billion in cash from operations via spending $130 million on capex, $882 million on share repurchases and $823 million on cash dividends. Free cash flow at second quarter-end was $1.6 billion.
Texas Instruments is one of the few chip-making companies that return a significant amount of cash to investors.
Bottom Line
Texas Instruments is one of the largest suppliers of analog and digital signal processing integrated circuits. The company’s compelling product line-up, increasing differentiation in business and low-cost 300-mm capacity should drive earnings over the long term.
Its margins should continue to expand because of secular strength in auto and industrial markets, a stronger mix of analog as well as embedded processing products, benefits of restructuring actions, and more than 300mm capacity coming online. Moreover, the semiconductor giant is poised to gain from the growing market for Internet of Things.
We believe that the increase in dividend and share buyback indicate that the company is confident about steady cash flow generation. However, increasing competition from Analog Devices, NVIDIA Corporation and Applied Materials remains a concern.
Long-term earnings growth rate for Dropbox, Etsy and Intuit is pegged at 34.4%, 28.5% and 12.3%, respectively.
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From thousands of stocks, 5 Zacks experts each picked their favorite to gain +100% or more in months to come. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
With users in 180 countries and soaring revenues, it’s set to thrive on remote working long after the pandemic ends. No wonder it recently offered a stunning $600 million stock buy-back plan.
The sky’s the limit for this emerging tech giant. And the earlier you get in, the greater your potential gain.
Image: Bigstock
Texas Instruments to Reward Investors With 13% Dividend Hike
Texas Instruments (TXN - Free Report) or TI recently announced a hike in dividend. The company plans to raise quarterly dividend by 12 cents to $1.02 per share. This translates to a 13% increase from the prior dividend of 90 cents.
The new dividend will be paid on Nov 16, 2020 to stockholders of record as of Oct 30, 2020, contingent upon a formal declaration by the board of directors at its regular meeting in October.
Texas Instruments Incorporated Price and Consensus
Texas Instruments Incorporated price-consensus-chart | Texas Instruments Incorporated Quote
TI’s Cash position
TI’s strong balance sheet and cash flow provide financial flexibility for dividend hikes, share repurchases and strategic acquisitions.
At the end of second-quarter 2020, its cash and short-term investments totaled $4.9 billion compared with $4.7 billion at the end of the prior quarter. Long-term debt was approximately $6.2 billion, up from $5.5 billion in the first quarter.
The company generated $1.7 billion in cash from operations via spending $130 million on capex, $882 million on share repurchases and $823 million on cash dividends. Free cash flow at second quarter-end was $1.6 billion.
Texas Instruments is one of the few chip-making companies that return a significant amount of cash to investors.
Bottom Line
Texas Instruments is one of the largest suppliers of analog and digital signal processing integrated circuits. The company’s compelling product line-up, increasing differentiation in business and low-cost 300-mm capacity should drive earnings over the long term.
Its margins should continue to expand because of secular strength in auto and industrial markets, a stronger mix of analog as well as embedded processing products, benefits of restructuring actions, and more than 300mm capacity coming online. Moreover, the semiconductor giant is poised to gain from the growing market for Internet of Things.
We believe that the increase in dividend and share buyback indicate that the company is confident about steady cash flow generation. However, increasing competition from Analog Devices, NVIDIA Corporation and Applied Materials remains a concern.
Zacks Rank and Other Stocks to Consider
Texas Instruments currently carries a Zacks Rank #1 (Strong Buy). Other top-ranked stocks in the broader technology sector include Dropbox (DBX - Free Report) , Etsy, Inc. (ETSY - Free Report) and Intuit Inc. (INTU - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rate for Dropbox, Etsy and Intuit is pegged at 34.4%, 28.5% and 12.3%, respectively.
Zacks’ Single Best Pick to Double
From thousands of stocks, 5 Zacks experts each picked their favorite to gain +100% or more in months to come. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
With users in 180 countries and soaring revenues, it’s set to thrive on remote working long after the pandemic ends. No wonder it recently offered a stunning $600 million stock buy-back plan.
The sky’s the limit for this emerging tech giant. And the earlier you get in, the greater your potential gain.
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