Company Reports

Wide-moat Texas Instruments reported predictably soft first-quarter results but provided investors with a positive second-quarter forecast that does not point to a massive downturn in the automotive semiconductor market—at least not yet. Shares rose as much as 8% after hours, but we still view them as overvalued relative to our unchanged $146 fair value estimate.

Texas Instruments is the world's largest analog chipmaker and a key supplier of analog and embedded chips into a wide range of applications. We’re encouraged by TI’s relentless focus on higher-margin semiconductors, and when combined with smart operational moves on the manufacturing front, we foresee robust free cash flow generation in the years ahead.

Wide-moat Texas Instruments reported predictably soft fourth-quarter results, but provided investors with a gloomy forecast for the March quarter that implies a sizable dip in gross margin and an ongoing slowdown in orders from industrial customers and headwinds in the automotive end market. We trimmed our fair value estimate to $146 from $155, as we’re making lower long-term revenue and gross margin assumptions, and shares appear a bit overvalued to us.

Wide-moat Texas Instruments reported predictably soft third-quarter results but provided investors with a gloomy outlook for the December quarter, as business conditions weakened among industrial customers and the company was no longer able to avoid factory underutilization expenses as it built up chip inventory. Based on our lower near-term outlook and modestly lower long-term revenue and gross margin assumptions, we cut our fair value estimate to $155 from $168. Shares appear attractively priced in the low $140 range after hours, although this latest industry downturn appears to be lingering a bit longer than prior cycles, likely as a hangover from the prosperous times from the global chip shortage in 2021 and 2022.

Texas Instruments is the world's largest analog chipmaker and a key supplier of analog and embedded chips into a wide range of applications. We’re encouraged by TI’s relentless focus on higher-margin semiconductors, and when combined with smart operational moves on the manufacturing front, we foresee robust free cash flow generation in the years ahead.

Wide-moat Texas Instruments reported predictably soft second-quarter results in line with expectations, but provided investors with a disappointing third-quarter outlook. We were discouraged by the report and earnings call, as TI’s revenue growth is lagging its peers, gross margins are deteriorating, inventory continues to rise, and we didn’t hear the strongest answers on how TI can turn the tide. We attribute TI’s underperformance mostly to its exposure to soft end markets such as personal electronics and communications equipment. We still view TI as a wide-moat firm with exemplary capital allocation policies, but recognize that investors have more reasons to question the company’s strategic steps than what we would have imagined a couple of years ago. Still, we maintain our $168 fair value estimate as our aforementioned concerns are minor for such a stout business. We view shares as slightly overvalued.

Texas Instruments is the world's largest analog chipmaker and a key supplier of analog and embedded chips into a wide range of applications. We remain encouraged with Texas Instruments' relentless focus on higher-margin semiconductors, and when combined with smart operational moves on the manufacturing front, we foresee robust free cash flow generation in the years ahead.

Wide-moat Texas Instruments reported first-quarter results and provided investors with a second-quarter forecast that was slightly lighter than our prior expectations. We maintain our $168 fair value estimate for TI and continue to view shares as fairly valued. The company is still seeing soft demand across many of its end markets, but its two most important ones, automotive and industrial, are still holding up well. Inventory levels are high, but still appear to be within a manageable range. Ultimately, we view these issues as mostly cyclical, rather than structural, and our long-term thesis that TI is a best-in-breed analog firm remains intact.

We will maintain our $168 fair value estimate for wide-moat Texas Instruments as it hosted its annual capital management call with investors. The key takeaway was the firm's plans to boost its capital expenditures even higher than previously anticipated, to levels of $5 billion per year through 2026 (and 10%-15% of revenue in 2027 and beyond), as compared with prior guidance of $3.5 billion through 2025 and 10% of revenue in 2026 and beyond.

Wide-moat Texas Instruments reported fourth-quarter results and provided investors with a first-quarter forecast that points to a slowdown in chip demand in almost all end markets (with automotive as the lone exception), which we attribute to macroeconomic headwinds. The company is seeing more order cancellations and pushouts, a far cry from business conditions a year ago when all types of customers were trying to buy every chip they could find. Nonetheless, TI has outlasted these types of cyclical downturns before, and we remain confident that the secular drivers of rising chip content in cars, industrial equipment, and many other types of electronics are still intact. We raise our fair value estimate to $168 from $158, almost entirely due to the time value of money as we roll our valuation model, and we would still wait for a wider margin of safety before investing.

Texas Instruments is the world's largest analog chipmaker and a key supplier of embedded chips into a wide range of applications. We remain encouraged with Texas Instruments' relentless focus on higher-margin analog and embedded semiconductors, and when combined with smart operational moves on the manufacturing front, we foresee robust free cash flow generation in the years ahead.

Texas Instruments reported solid third-quarter results but provided investors with a downbeat fourth-quarter forecast. We trim our fair value estimate for wide-moat TI down to $158 from $166, and despite shares falling about 6% after hours to the $153 range, we continue to view TI’s shares as fairly valued.

Texas Instruments is the world's largest analog chipmaker and a key supplier of embedded chips into a wide range of applications. We remain encouraged with Texas Instruments' relentless focus on higher-margin analog and embedded semiconductors, and when combined with smart operational moves on the manufacturing front, we foresee robust free cash flow generation in the years ahead.

Texas Instruments, or TI, reported strong second-quarter results and provided investors with an upbeat third quarter outlook. The company admittedly reduced its revenue guidance three months ago by $0.5 billion haircut because of China's COVID-19 shutdowns, but these restrictions eased later in the quarter, and when combined with healthy demand elsewhere, TI easily outpaced its guidance. We maintain our $166 fair value estimate for wide-moat TI and view shares as fairly valued.

Texas Instruments is the world's largest analog chipmaker and a key supplier of embedded chips into a wide range of applications. We remain encouraged with Texas Instruments' relentless focus on higher-margin analog and embedded semiconductors, and when combined with smart operational moves on the manufacturing front, we foresee robust free cash flow generation in the years ahead.

Wide-moat Texas Instruments reported healthy first-quarter results but gave investors a disappointing second quarter outlook, as revenue at the midpoint may be down year over year after several quarters of tremendous growth during the global chip shortage. TI foresees COVID-19 restrictions in China disrupting the manufacturing plans of its customers, and the company reduced its midpoint of second-quarter guidance by 10% as a result. Despite the near-term constraints, we still foresee robust long-term, secular demand for TI's products. We trim our fair value estimate to $166 from $172 due to the near-term revenue shortfall and still view shares as fairly valued.

We will maintain our $172 fair value estimate for wide-moat Texas Instruments, or TI, as it hosted a relatively eventful capital management call with investors. The highlight is TI's plans to significantly boost its capital expenditures over the next decade to levels twice as high as our prior expectations. Shares fell as much as 6% during the call, likely out of fears of future excess capacity and perhaps less cash that will be free to return to shareholders. We still consider TI's capital allocation as Exemplary; we don't view these capital expenditure plans as wrong, but they strike us as aggressive and perhaps riskier than the firm's exceptionally managed expansion over the past decade. More important, TI will always have the chance to reverse course, so we will anticipate this well-run organization to shift its needs if business goes south. We view TI's shares as fairly valued.

Wide-moat Texas Instruments reported exceptional fourth-quarter results amid the global semiconductor shortage, while the company also provided investors with a strong first quarter outlook. We raise our fair value estimate to $172 from $166, mostly due to the time value of money as we roll our valuation model, and view shares as fairly valued.

Texas Instruments is the world's largest analog chipmaker and a key supplier of embedded chips into a wide range of applications. We remain encouraged with Texas Instruments' relentless focus on higher-margin analog and embedded semiconductors, and when combined with smart operational moves on the manufacturing front, we foresee robust free cash flow generation in the years ahead.

Texas Instruments is the world's largest analog chipmaker and a key supplier of embedded chips into a wide range of applications. We remain encouraged with Texas Instruments' relentless focus on higher-margin analog and embedded semiconductors, and when combined with smart operational moves on the manufacturing front, we foresee robust free cash flow generation in the years ahead.