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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 the most recent trading day at $204.10, moving +1.12% from the previous trading session. The stock's performance was ahead of the S&P 500's daily loss of 0.16%. At the same time, the Dow added 0.09%, and the tech-heavy Nasdaq lost 0.3%.

The the stock of chipmaker has risen by 7.96% in the past month, leading the Computer and Technology sector's gain of 1.63% and the S&P 500's gain of 3.64%.

The investment community will be paying close attention to the earnings performance of Texas Instruments in its upcoming release. The company is predicted to post an EPS of $1.36, indicating a 24.44% decline compared to the equivalent quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $4.11 billion, indicating a 9.29% decline compared to the corresponding quarter of the prior year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $5.11 per share and revenue of $15.72 billion, which would represent changes of -27.72% and -10.28%, respectively, from the prior year.

Any recent changes to analyst estimates for Texas Instruments should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. 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 0.1% higher. Texas Instruments currently has a Zacks Rank of #3 (Hold).

In terms of valuation, Texas Instruments is currently trading at a Forward P/E ratio of 39.49. This signifies a premium in comparison to the average Forward P/E of 21.66 for its industry.

We can additionally observe that TXN currently boasts a PEG ratio of 4.39. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. By the end of yesterday's trading, the Semiconductor - General industry had an average PEG ratio of 3.98.

The Semiconductor - General industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 219, this industry ranks in the bottom 14% of all industries, numbering over 250.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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