We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
TXN Gains 18.4% YTD: Should You Buy, Hold or Sell the Stock?
Read MoreHide Full Article
Texas Instruments’ (TXN - Free Report) shares have rallied 18.4% in the year-to-date period, outperforming the Zacks Computer & Technology sector’s rise of 15.9%. It has also outpaced the S&P 500 Index’s appreciation of 15.6% over the same timeframe.
TXN is benefiting from solid demand for data centers, which is boosting its prospects in the enterprise systems market. Improving conditions in the personal electronics and communication equipment markets are a plus.
The company’s deepening focus on innovation of manufacturing techniques and advanced technology infusion in a bid to strengthen its portfolio offerings is expected to drive its business.
Hence, the question that investors should mull over is – would these strong efforts help TXN stock in continuing its momentum?
Texas Instruments Incorporated Price and Consensus
Texas Instruments’ product portfolio expansion efforts include the launch of the DLPC8445 display controller — a new, compact solution for 4K UHD projectors. It enables ultra-small, high-performance projectors for gaming and AR glasses, delivering sub-millisecond latency and frame rates up to 240Hz.
TXN’s new MagPack power modules integrate a power chip, transformer, or inductor into a single package, reducing the size by up to 23% and cutting board space and power losses. With a power density of nearly 1A per 1mm², these modules also lower temperature and emissions, making them ideal for data centers.
Texas Instruments' DRV7308 gallium nitride (GaN) intelligent power module (IPM) boosts its portfolio by enhancing motor drive systems. It provides more than 99% inverter efficiency, superior acoustic performance and reduces both size and system costs.
TXN’s new power conversion device portfolios offer high power density in compact designs at a lower cost. Featuring 100V integrated gallium nitride power stages and 1.5W isolated DC/DC modules, these devices enable engineers to achieve more power in smaller spaces.
The company also launched new semiconductors, including the AWR2544 77GHz radar sensor chip and the software-programmable DRV3946-Q1 and DRV3901-Q1 driver chips. These innovations enhance automotive safety and intelligence by improving sensor fusion and decision-making in advanced driver assistance systems (ADAS).
Texas Instruments has added the LMG3622, LMG3624 and LMG3626 to its low-power GaN portfolio, improving power density and efficiency. These devices include integrated current sensing, eliminating external shunt resistors and cutting power losses by up to 94%.
Strength in the company’s overall portfolio offerings will likely aid its top-line performance in the upcoming period.
Stiff Competition Hinders TXN Stock
Texas Instruments faces stiff competition from incumbents like ON Semiconductor (ON - Free Report) , STMicroelectronics (STM - Free Report) and Broadcom (AVGO - Free Report) which are also making concerted efforts to bolster their technology portfolio.
On a year-to-date basis, TXN has outperformed both ON and STM, which declined 16.1% and 41.1%, respectively. However, TXN has underperformed AVGO which has gained 36.8% in the same time frame.
ON Semiconductor has acquired SWIR Vision Systems, a leader in CQD-based short-wavelength infrared technology. This acquisition will enhance onsemi’s CMOS sensors with advanced imaging capabilities, boosting growth in industrial, automotive and defense markets.
STMicroelectronics' new EVLDRIVE101-HPD motor-drive reference design includes a 3-phase gate driver, STM32G0 microcontroller and 750W power stage on a 50mm PCB. With sleep mode power consumption under 1µA, it's ideal for hairdryers, vacuums, power tools, drones, robots and industrial equipment.
Broadcom recently launched Rally Anywhere, an on-premises version of its enterprise agility platform. Rally Anywhere helps global teams plan, prioritize, manage and track projects while ensuring compliance with data sovereignty and security requirements.
Conclusion
Texas Instruments’ growing investments in new growth avenues, strong portfolio, and advanced technology infusion are expected to drive its prospects.
However, growing competitive pressure, macroeconomic uncertainties and geo-political tensions especially between the United States and China remain major concerns for the company. Increasing manufacturing costs across its Analog and Embedded segments are also hurting its margin expansion. These factors make TXN’s near-term prospects foggy.
For third-quarter 2024, TXN expects revenues between $3.94 billion and $4.26 billion. The Zacks Consensus Estimate for third-quarter 2024 revenues is pegged at $4.11 billion, indicating a fall of 9.3% year over year.
The company expects third-quarter 2024 earnings within $1.24-$1.48 per share. The Zacks Consensus Estimate for the same is pegged at $1.36 per share, indicating a decline of 24.4% year over year. The consensus mark for earnings has remained unchanged in the past 30 days.
Moreover, TXN has a Value Score of F that reflects stretched valuation at the current level.
Image: Bigstock
TXN Gains 18.4% YTD: Should You Buy, Hold or Sell the Stock?
Texas Instruments’ (TXN - Free Report) shares have rallied 18.4% in the year-to-date period, outperforming the Zacks Computer & Technology sector’s rise of 15.9%. It has also outpaced the S&P 500 Index’s appreciation of 15.6% over the same timeframe.
TXN is benefiting from solid demand for data centers, which is boosting its prospects in the enterprise systems market. Improving conditions in the personal electronics and communication equipment markets are a plus.
The company’s deepening focus on innovation of manufacturing techniques and advanced technology infusion in a bid to strengthen its portfolio offerings is expected to drive its business.
Hence, the question that investors should mull over is – would these strong efforts help TXN stock in continuing its momentum?
Texas Instruments Incorporated Price and Consensus
Texas Instruments Incorporated price-consensus-chart | Texas Instruments Incorporated Quote
Expanding Portfolio Drives TXN Stock’s Prospects
Texas Instruments’ product portfolio expansion efforts include the launch of the DLPC8445 display controller — a new, compact solution for 4K UHD projectors. It enables ultra-small, high-performance projectors for gaming and AR glasses, delivering sub-millisecond latency and frame rates up to 240Hz.
TXN’s new MagPack power modules integrate a power chip, transformer, or inductor into a single package, reducing the size by up to 23% and cutting board space and power losses. With a power density of nearly 1A per 1mm², these modules also lower temperature and emissions, making them ideal for data centers.
Texas Instruments' DRV7308 gallium nitride (GaN) intelligent power module (IPM) boosts its portfolio by enhancing motor drive systems. It provides more than 99% inverter efficiency, superior acoustic performance and reduces both size and system costs.
TXN’s new power conversion device portfolios offer high power density in compact designs at a lower cost. Featuring 100V integrated gallium nitride power stages and 1.5W isolated DC/DC modules, these devices enable engineers to achieve more power in smaller spaces.
The company also launched new semiconductors, including the AWR2544 77GHz radar sensor chip and the software-programmable DRV3946-Q1 and DRV3901-Q1 driver chips. These innovations enhance automotive safety and intelligence by improving sensor fusion and decision-making in advanced driver assistance systems (ADAS).
Texas Instruments has added the LMG3622, LMG3624 and LMG3626 to its low-power GaN portfolio, improving power density and efficiency. These devices include integrated current sensing, eliminating external shunt resistors and cutting power losses by up to 94%.
Strength in the company’s overall portfolio offerings will likely aid its top-line performance in the upcoming period.
Stiff Competition Hinders TXN Stock
Texas Instruments faces stiff competition from incumbents like ON Semiconductor (ON - Free Report) , STMicroelectronics (STM - Free Report) and Broadcom (AVGO - Free Report) which are also making concerted efforts to bolster their technology portfolio.
On a year-to-date basis, TXN has outperformed both ON and STM, which declined 16.1% and 41.1%, respectively. However, TXN has underperformed AVGO which has gained 36.8% in the same time frame.
ON Semiconductor has acquired SWIR Vision Systems, a leader in CQD-based short-wavelength infrared technology. This acquisition will enhance onsemi’s CMOS sensors with advanced imaging capabilities, boosting growth in industrial, automotive and defense markets.
STMicroelectronics' new EVLDRIVE101-HPD motor-drive reference design includes a 3-phase gate driver, STM32G0 microcontroller and 750W power stage on a 50mm PCB. With sleep mode power consumption under 1µA, it's ideal for hairdryers, vacuums, power tools, drones, robots and industrial equipment.
Broadcom recently launched Rally Anywhere, an on-premises version of its enterprise agility platform. Rally Anywhere helps global teams plan, prioritize, manage and track projects while ensuring compliance with data sovereignty and security requirements.
Conclusion
Texas Instruments’ growing investments in new growth avenues, strong portfolio, and advanced technology infusion are expected to drive its prospects.
However, growing competitive pressure, macroeconomic uncertainties and geo-political tensions especially between the United States and China remain major concerns for the company. Increasing manufacturing costs across its Analog and Embedded segments are also hurting its margin expansion. These factors make TXN’s near-term prospects foggy.
For third-quarter 2024, TXN expects revenues between $3.94 billion and $4.26 billion. The Zacks Consensus Estimate for third-quarter 2024 revenues is pegged at $4.11 billion, indicating a fall of 9.3% year over year.
The company expects third-quarter 2024 earnings within $1.24-$1.48 per share. The Zacks Consensus Estimate for the same is pegged at $1.36 per share, indicating a decline of 24.4% year over year. The consensus mark for earnings has remained unchanged in the past 30 days.
Moreover, TXN has a Value Score of F that reflects stretched valuation at the current level.
Investors should wait for a better entry point for Texas Instruments, which currently has a Zacks Rank #3 (Hold), given its stretched valuation and declining estimates. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.