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Texas Instruments Incorporated (TXN) Fundamentals Preview

Posted in Business1 year ago • Written by Ash KNo Comments

Texas Instruments Incorporated (TXN) has received an average target price from analysts of 119.70 amounting to a recommendation rating of Overweight. That comes from 31 different analysts. Perhaps, the driver for that assessment comes from the company’s valuations. Right now, we are looking at a median price-to-earnings ratio for this calendar year of 20.86.

To give a sense of trend, the same data point on the estimate for next year is currently sitting at 18.48 times earnings. Drilling down a bit further, this quarter, we are looking at an average estimate from analysts for earnings per share level of 26.00. That shift to 26.00 heading into next quarter.

Texas Instruments Incorporated engages in the design and manufacture semiconductor solutions for analog and digital embedded and application processing. It operates through the following business segments: Analog & Embedded Processing. The Analog segment semiconductors change real-world signals such as soundtemperaturepressure or imagesby conditioning themamplifying them and often converting them to a stream of digital data that can be processed by other semiconductorssuch as embedded processors. Embedded processing segment designed to handle specific tasks and can be optimized for various combinations of performancepower and costdepending on the application. The company was founded by Cecil H. GreenPatrick Eugene HaggertyJohn Erik Jonsson and Eugene McDermott in 1930 and is headquartered in DallasTX.
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Stock of Texas Instruments Incorporated (TXN) last opened at $112.04 and traded at $111.90 x 100. More than 1,513,697 shares exchanged hands compared to an average daily volume of 6,270,568 shares. At the current pps, the market capitalization stands at 109.988B.

Investors try to use stocks with high beta values to quickly recoup their investments after sharp market losses. Texas Instruments Incorporated (TXN) currently has a Beta value of 1.19 . Beta is a measurement of a stock’s price fluctuations, which is often called volatility and is used by investors to gauge how quickly a stock’s price will rise or fall. A stock with a beta of greater than 1.0 is riskier and has greater price fluctuations, while stocks with beta values of less than 1.0 are steadier and generally larger companies. Beta is often measured against the S&P; 500 index. An S&P; 500 stock with a beta of 2.0 produced a 20 percent increase in returns during a period of time when the S&P; 500 Index grew only 10 percent. This same measurement also means the stock would lose 20 percent when the market dropped by only 10 percent.

Next, let’s take a look at Texas Instruments Incorporated (TXN) current P/E ratio. Texas Instruments Incorporated (TXN) currently has a PE ratio of 31.00. PE ratio is an important parameter to look at when trading a stock mostly because it is easy to calculate. There are a couple of ways to calculate PE ratio either by dividing share price by earnings per share or dividing the market cap by net income. It is important to note that the earnings are usually taken from the trailing twelve months (TTM). Nevertheless, P/E tells us how much an investor is willing to pay for $1 of a company’s earnings. The long-term average P/E is around 15, so on average, investors are willing to pay $15 for every dollar of earnings. Another useful way to look at this: Turn the P/E ratio around to look at the E/P ratio, which when expressed as a percentage gives us the earnings yield. For instance: 1/15 gives us an earnings yield of 6.67%.

While we have already looked at Texas Instruments Incorporated (TXN) beta and P/E ratio, the EPS cannot be ignored. Texas Instruments Incorporated (TXN) EPS for the trailing twelve months was 3.61. Traders and investors often use earnings per share (TTM) to determine a company’s profitability for the past year. So in essence, EPS is the amount of a company’s net income per share of common stock. Earnings per share equal the company’s net income less any dividends paid on preferred stock divided by the weighted average number of common stock shares outstanding during the year. Texas Instruments Incorporated (TXN) is estimated to release its next earnings report on Apr 24, 2018. It would be interesting to see how the earnings fair out considering the recent developments.

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Ash has been in the media business for over seven years both behind and in front of the mic and camera. After years of experience both at Wallstreet and Bombay Stock Exchange he has finally embraced the web with as a district manager and producer.

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