TEXAS INSTRUMENTS INC (TXN) Stock Fundamental Analysis
USA - NASDAQ:TXN - US8825081040 - Common Stock
159.33 USD
-2.9 (-1.79%)
159.41 USD
+0.08 (+0.05%)
TXN gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 112 industry peers in the Semiconductors & Semiconductor Equipment industry. While TXN belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. TXN is not valued too expensively and it also shows a decent growth rate. TXN also has an excellent dividend rating. These ratings could make TXN a good candidate for dividend investing.
1. Profitability
1.1 Basic Checks
TXN had positive earnings in the past year.
TXN had a positive operating cash flow in the past year.
TXN had positive earnings in each of the past 5 years.
Each year in the past 5 years TXN had a positive operating cash flow.
1.2 Ratios
TXN's Return On Assets of 14.33% is amongst the best of the industry. TXN outperforms 89.29% of its industry peers.
Looking at the Return On Equity, with a value of 30.17%, TXN belongs to the top of the industry, outperforming 91.96% of the companies in the same industry.
TXN has a Return On Invested Capital of 16.57%. This is amongst the best in the industry. TXN outperforms 91.07% of its industry peers.
TXN had an Average Return On Invested Capital over the past 3 years of 24.88%. This is significantly above the industry average of 10.93%.
The last Return On Invested Capital (16.57%) for TXN is well below the 3 year average (24.88%), which needs to be investigated, but indicates that TXN had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.33% | ||
| ROE | 30.17% | ||
| ROIC | 16.57% |
ROA(3y)21.83%
ROA(5y)25.12%
ROE(3y)42.11%
ROE(5y)48.99%
ROIC(3y)24.88%
ROIC(5y)28.23%
1.3 Margins
TXN has a Profit Margin of 29.05%. This is amongst the best in the industry. TXN outperforms 90.18% of its industry peers.
TXN's Profit Margin has declined in the last couple of years.
The Operating Margin of TXN (34.82%) is better than 92.86% of its industry peers.
TXN's Operating Margin has declined in the last couple of years.
TXN has a Gross Margin of 57.48%. This is amongst the best in the industry. TXN outperforms 82.14% of its industry peers.
In the last couple of years the Gross Margin of TXN has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 34.82% | ||
| PM (TTM) | 29.05% | ||
| GM | 57.48% |
OM growth 3Y-11.42%
OM growth 5Y-2.89%
PM growth 3Y-10.21%
PM growth 5Y-2.51%
GM growth 3Y-4.84%
GM growth 5Y-1.81%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so TXN is creating value.
Compared to 1 year ago, TXN has more shares outstanding
TXN has less shares outstanding than it did 5 years ago.
TXN has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 8.34 indicates that TXN is not in any danger for bankruptcy at the moment.
TXN has a Altman-Z score of 8.34. This is in the better half of the industry: TXN outperforms 70.54% of its industry peers.
TXN has a debt to FCF ratio of 6.75. This is a slightly negative value and a sign of low solvency as TXN would need 6.75 years to pay back of all of its debts.
TXN has a Debt to FCF ratio of 6.75. This is comparable to the rest of the industry: TXN outperforms 54.46% of its industry peers.
TXN has a Debt/Equity ratio of 0.81. This is a neutral value indicating TXN is somewhat dependend on debt financing.
TXN has a worse Debt to Equity ratio (0.81) than 82.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | 6.75 | ||
| Altman-Z | 8.34 |
ROIC/WACC1.56
WACC10.65%
2.3 Liquidity
TXN has a Current Ratio of 4.45. This indicates that TXN is financially healthy and has no problem in meeting its short term obligations.
With a decent Current ratio value of 4.45, TXN is doing good in the industry, outperforming 66.96% of the companies in the same industry.
TXN has a Quick Ratio of 2.90. This indicates that TXN is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of TXN (2.90) is better than 62.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 4.45 | ||
| Quick Ratio | 2.9 |
3. Growth
3.1 Past
TXN shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 1.67%.
TXN shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.90%.
TXN shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.69% yearly.
EPS 1Y (TTM)1.67%
EPS 3Y-14.28%
EPS 5Y0%
EPS Q2Q%0.68%
Revenue 1Y (TTM)9.9%
Revenue growth 3Y-5.17%
Revenue growth 5Y1.69%
Sales Q2Q%14.24%
3.2 Future
Based on estimates for the next years, TXN will show a quite strong growth in Earnings Per Share. The EPS will grow by 17.13% on average per year.
The Revenue is expected to grow by 10.11% on average over the next years. This is quite good.
EPS Next Y6.67%
EPS Next 2Y9.21%
EPS Next 3Y13.82%
EPS Next 5Y17.13%
Revenue Next Year14.12%
Revenue Next 2Y11.03%
Revenue Next 3Y10.99%
Revenue Next 5Y10.11%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 29.13, which means the current valuation is very expensive for TXN.
Compared to the rest of the industry, the Price/Earnings ratio of TXN indicates a somewhat cheap valuation: TXN is cheaper than 74.11% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 25.89, TXN is valued at the same level.
TXN is valuated quite expensively with a Price/Forward Earnings ratio of 25.74.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TXN indicates a somewhat cheap valuation: TXN is cheaper than 64.29% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of TXN to the average of the S&P500 Index (34.59), we can say TXN is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.13 | ||
| Fwd PE | 25.74 |
4.2 Price Multiples
70.54% of the companies in the same industry are more expensive than TXN, based on the Enterprise Value to EBITDA ratio.
TXN's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 69.64 | ||
| EV/EBITDA | 19.58 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates TXN does not grow enough to justify the current Price/Earnings ratio.
TXN has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as TXN's earnings are expected to grow with 13.82% in the coming years.
PEG (NY)4.37
PEG (5Y)N/A
EPS Next 2Y9.21%
EPS Next 3Y13.82%
5. Dividend
5.1 Amount
TXN has a Yearly Dividend Yield of 3.50%.
TXN's Dividend Yield is rather good when compared to the industry average which is at 2.21. TXN pays more dividend than 95.54% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.42, TXN pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.5% |
5.2 History
The dividend of TXN is nicely growing with an annual growth rate of 10.46%!
TXN has been paying a dividend for at least 10 years, so it has a reliable track record.
TXN has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)10.46%
Div Incr Years21
Div Non Decr Years26
5.3 Sustainability
98.66% of the earnings are spent on dividend by TXN. This is not a sustainable payout ratio.
TXN's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP98.66%
EPS Next 2Y9.21%
EPS Next 3Y13.82%
159.33
-2.9 (-1.79%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners91.03%
Inst Owner Change-1.22%
Ins Owners0.22%
Ins Owner Change-0.15%
Market Cap144.85B
Revenue(TTM)17.27B
Net Income(TTM)5.02B
Analysts66.82
Price Target190.1 (19.31%)
Short Float %1.73%
Short Ratio2.15
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.5% |
Yearly Dividend5.27
Dividend Growth(5Y)10.46%
DP98.66%
Div Incr Years21
Div Non Decr Years26
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.76%
Min EPS beat(2)-1.62%
Max EPS beat(2)3.14%
EPS beat(4)3
Avg EPS beat(4)6.78%
Min EPS beat(4)-1.62%
Max EPS beat(4)18.72%
EPS beat(8)7
Avg EPS beat(8)6.02%
EPS beat(12)11
Avg EPS beat(12)5.31%
EPS beat(16)15
Avg EPS beat(16)6.38%
Revenue beat(2)2
Avg Revenue beat(2)1.12%
Min Revenue beat(2)1.09%
Max Revenue beat(2)1.15%
Revenue beat(4)4
Avg Revenue beat(4)1.91%
Min Revenue beat(4)1.09%
Max Revenue beat(4)3.01%
Revenue beat(8)5
Avg Revenue beat(8)0.6%
Revenue beat(12)7
Avg Revenue beat(12)0.4%
Revenue beat(16)11
Avg Revenue beat(16)1.75%
PT rev (1m)-7.1%
PT rev (3m)-7.28%
EPS NQ rev (1m)-9.17%
EPS NQ rev (3m)-9.23%
EPS NY rev (1m)-2.27%
EPS NY rev (3m)-1.5%
Revenue NQ rev (1m)-1.9%
Revenue NQ rev (3m)-1.9%
Revenue NY rev (1m)0.16%
Revenue NY rev (3m)0.06%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.13 | ||
| Fwd PE | 25.74 | ||
| P/S | 8.39 | ||
| P/FCF | 69.64 | ||
| P/OCF | 21 | ||
| P/B | 8.71 | ||
| P/tB | 12.04 | ||
| EV/EBITDA | 19.58 |
EPS(TTM)5.47
EY3.43%
EPS(NY)6.19
Fwd EY3.88%
FCF(TTM)2.29
FCFY1.44%
OCF(TTM)7.59
OCFY4.76%
SpS18.99
BVpS18.29
TBVpS13.23
PEG (NY)4.37
PEG (5Y)N/A
Graham Number47.44
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.33% | ||
| ROE | 30.17% | ||
| ROCE | 18.85% | ||
| ROIC | 16.57% | ||
| ROICexc | 19.79% | ||
| ROICexgc | 23.91% | ||
| OM | 34.82% | ||
| PM (TTM) | 29.05% | ||
| GM | 57.48% | ||
| FCFM | 12.05% |
ROA(3y)21.83%
ROA(5y)25.12%
ROE(3y)42.11%
ROE(5y)48.99%
ROIC(3y)24.88%
ROIC(5y)28.23%
ROICexc(3y)37.04%
ROICexc(5y)45.04%
ROICexgc(3y)50.11%
ROICexgc(5y)68.14%
ROCE(3y)28.31%
ROCE(5y)32.12%
ROICexgc growth 3Y-37.97%
ROICexgc growth 5Y-22.81%
ROICexc growth 3Y-32.93%
ROICexc growth 5Y-16.48%
OM growth 3Y-11.42%
OM growth 5Y-2.89%
PM growth 3Y-10.21%
PM growth 5Y-2.51%
GM growth 3Y-4.84%
GM growth 5Y-1.81%
F-Score7
Asset Turnover0.49
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | 6.75 | ||
| Debt/EBITDA | 1.72 | ||
| Cap/Depr | 256.63% | ||
| Cap/Sales | 27.9% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 87.43% | ||
| Profit Quality | 41.47% | ||
| Current Ratio | 4.45 | ||
| Quick Ratio | 2.9 | ||
| Altman-Z | 8.34 |
F-Score7
WACC10.65%
ROIC/WACC1.56
Cap/Depr(3y)333.46%
Cap/Depr(5y)264.77%
Cap/Sales(3y)24.58%
Cap/Sales(5y)18.33%
Profit Quality(3y)40.07%
Profit Quality(5y)60.03%
High Growth Momentum
Growth
EPS 1Y (TTM)1.67%
EPS 3Y-14.28%
EPS 5Y0%
EPS Q2Q%0.68%
EPS Next Y6.67%
EPS Next 2Y9.21%
EPS Next 3Y13.82%
EPS Next 5Y17.13%
Revenue 1Y (TTM)9.9%
Revenue growth 3Y-5.17%
Revenue growth 5Y1.69%
Sales Q2Q%14.24%
Revenue Next Year14.12%
Revenue Next 2Y11.03%
Revenue Next 3Y10.99%
Revenue Next 5Y10.11%
EBIT growth 1Y9.37%
EBIT growth 3Y-16.01%
EBIT growth 5Y-1.25%
EBIT Next Year50.61%
EBIT Next 3Y27.29%
EBIT Next 5Y22.29%
FCF growth 1Y26.21%
FCF growth 3Y-38.03%
FCF growth 5Y-23.72%
OCF growth 1Y5.49%
OCF growth 3Y-10.31%
OCF growth 5Y-1.02%
TEXAS INSTRUMENTS INC / TXN FAQ
What is the ChartMill fundamental rating of TEXAS INSTRUMENTS INC (TXN) stock?
ChartMill assigns a fundamental rating of 6 / 10 to TXN.
Can you provide the valuation status for TEXAS INSTRUMENTS INC?
ChartMill assigns a valuation rating of 4 / 10 to TEXAS INSTRUMENTS INC (TXN). This can be considered as Fairly Valued.
How profitable is TEXAS INSTRUMENTS INC (TXN) stock?
TEXAS INSTRUMENTS INC (TXN) has a profitability rating of 8 / 10.
How financially healthy is TEXAS INSTRUMENTS INC?
The financial health rating of TEXAS INSTRUMENTS INC (TXN) is 6 / 10.
What is the earnings growth outlook for TEXAS INSTRUMENTS INC?
The Earnings per Share (EPS) of TEXAS INSTRUMENTS INC (TXN) is expected to grow by 6.67% in the next year.