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Texas Instruments (TXN) Gains As Market Dips: What You Should Know

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Texas Instruments (TXN - Free Report) closed at $175.98 in the latest trading session, marking a +0.93% move from the prior day. This move outpaced the S&P 500's daily loss of 0.06%. Meanwhile, the Dow lost 0.71%, and the Nasdaq, a tech-heavy index, added 0.76%.

Prior to today's trading, shares of the chipmaker had lost 1.22% over the past month. This has was narrower than the Computer and Technology sector's loss of 6.54% and lagged the S&P 500's gain of 0.17% in that time.

TXN will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.56, up 25.81% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.96 billion, up 19.04% from the year-ago period.

TXN's full-year Zacks Consensus Estimates are calling for earnings of $6.75 per share and revenue of $16.68 billion. These results would represent year-over-year changes of +13.07% and +15.32%, respectively.

Any recent changes to analyst estimates for TXN should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.87% higher. TXN is currently a Zacks Rank #2 (Buy).

Investors should also note TXN's current valuation metrics, including its Forward P/E ratio of 25.82. For comparison, its industry has an average Forward P/E of 24.38, which means TXN is trading at a premium to the group.

Meanwhile, TXN's PEG ratio is currently 2.77. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Semiconductor - General industry currently had an average PEG ratio of 2.9 as of yesterday's close.

The Semiconductor - General industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 41, putting it in the top 17% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow TXN in the coming trading sessions, be sure to utilize Zacks.com.


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