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

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In the latest trading session, Texas Instruments (TXN) closed at $190.84, marking a -0.76% move from the previous day. This change lagged the S&P 500's daily gain of 0.52%.

Prior to today's trading, shares of the chipmaker had gained 0.81% over the past month. This has lagged the Computer and Technology sector's gain of 6.22% and the S&P 500's gain of 2.25% 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 $1.57, up 6.08% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $4.32 billion, up 33.32% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $7.39 per share and revenue of $17.47 billion. These totals would mark changes of +23.79% and +20.83%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for TXN. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. TXN currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that TXN has a Forward P/E ratio of 26.02 right now. This valuation marks a premium compared to its industry's average Forward P/E of 22.23.

Also, we should mention that TXN has a PEG ratio of 2.79. 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. TXN's industry had an average PEG ratio of 2.79 as of yesterday's close.

The Semiconductor - General industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 86, which puts it in the top 34% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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