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Texas Instruments (TXN) Dips More Than Broader Markets: What You Should Know

·3 min read

Texas Instruments (TXN) closed the most recent trading day at $165.21, moving -0.92% from the previous trading session. This change lagged the S&P 500's 0.78% loss on the day. Elsewhere, the Dow lost 0.88%, while the tech-heavy Nasdaq lost 0.26%.

Prior to today's trading, shares of the chipmaker had lost 5.91% over the past month. This has lagged the Computer and Technology sector's loss of 4.58% and the S&P 500's loss of 3.4% in that time.

Texas Instruments will be looking to display strength as it nears its next earnings release. On that day, Texas Instruments is projected to report earnings of $2.37 per share, which would represent year-over-year growth of 14.49%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.11 billion, up 10.16% from the year-ago period.

TXN's full-year Zacks Consensus Estimates are calling for earnings of $9.35 per share and revenue of $20.08 billion. These results would represent year-over-year changes of +13.2% and +9.44%, respectively.

Any recent changes to analyst estimates for Texas Instruments should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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 remained stagnant. Texas Instruments is currently a Zacks Rank #2 (Buy).

Investors should also note Texas Instruments's current valuation metrics, including its Forward P/E ratio of 17.83. This represents a premium compared to its industry's average Forward P/E of 12.45.

We can also see that TXN currently has a PEG ratio of 1.91. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Semiconductor - General was holding an average PEG ratio of 1.91 at yesterday's closing price.

The Semiconductor - General industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 150, putting it in the bottom 41% of all 250+ industries.

The Zacks Industry Rank includes is listed in order 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.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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