192.805 USD
-2.19 (-1.12%)
TXN gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 113 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. While showing a medium growth rate, TXN is valued expensive at the moment. TXN also has an excellent dividend rating. These ratings could make TXN a good candidate for dividend investing.
1. Profitability
1.1 Basic Checks
- In the past year TXN was profitable.
- In the past year TXN had a positive cash flow from operations.
- In the past 5 years TXN has always been profitable.
- TXN had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- With an excellent Return On Assets value of 14.33%, TXN belongs to the best of the industry, outperforming 88.50% of the companies in the same industry.
- The Return On Equity of TXN (30.17%) is better than 92.04% of its industry peers.
- The Return On Invested Capital of TXN (16.57%) is better than 91.15% 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 10.75%.
- 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 better Profit Margin (29.05%) than 88.50% of its industry peers.
- TXN's Profit Margin has declined in the last couple of years.
- TXN has a Operating Margin of 34.82%. This is amongst the best in the industry. TXN outperforms 92.92% of its industry peers.
- TXN's Operating Margin has declined in the last couple of years.
- TXN's Gross Margin of 57.48% is amongst the best of the industry. TXN outperforms 81.42% 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
- TXN has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
- TXN has more shares outstanding than it did 1 year ago.
- The number of shares outstanding for TXN has been reduced compared to 5 years ago.
- The debt/assets ratio for TXN is higher compared to a year ago.
2.2 Solvency
- An Altman-Z score of 9.31 indicates that TXN is not in any danger for bankruptcy at the moment.
- With a decent Altman-Z score value of 9.31, TXN is doing good in the industry, outperforming 66.37% of the companies in the same industry.
- The Debt to FCF ratio of TXN is 6.75, which is on the high side as it means it would take TXN, 6.75 years of fcf income to pay off all of its debts.
- Looking at the Debt to FCF ratio, with a value of 6.75, TXN is in line with its industry, outperforming 53.98% of the companies in the same industry.
- A Debt/Equity ratio of 0.81 indicates that TXN is somewhat dependend on debt financing.
- TXN has a worse Debt to Equity ratio (0.81) than 81.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | 6.75 | ||
| Altman-Z | 9.31 |
ROIC/WACC1.54
WACC10.73%
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.
- TXN has a Current ratio of 4.45. This is in the better half of the industry: TXN outperforms 66.37% of its industry peers.
- 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.
- Looking at the Quick ratio, with a value of 2.90, TXN is in the better half of the industry, outperforming 61.95% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 4.45 | ||
| Quick Ratio | 2.9 |
3. Growth
3.1 Past
- The Earnings Per Share has been growing slightly by 1.67% over the past year.
- Looking at the last year, TXN shows a quite strong growth in Revenue. The Revenue has grown by 9.90% in the last year.
- 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
- The Earnings Per Share is expected to grow by 17.13% on average over the next years. This is quite good.
- TXN is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.26% yearly.
EPS Next Y6.63%
EPS Next 2Y9.18%
EPS Next 3Y13.64%
EPS Next 5Y17.13%
Revenue Next Year14.1%
Revenue Next 2Y10.99%
Revenue Next 3Y10.82%
Revenue Next 5Y10.26%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 35.25, the valuation of TXN can be described as expensive.
- Compared to the rest of the industry, the Price/Earnings ratio of TXN indicates a somewhat cheap valuation: TXN is cheaper than 76.99% of the companies listed in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 27.30, TXN is valued a bit more expensive.
- TXN is valuated quite expensively with a Price/Forward Earnings ratio of 31.17.
- Based on the Price/Forward Earnings ratio, TXN is valued a bit cheaper than the industry average as 69.03% of the companies are valued more expensively.
- When comparing the Price/Forward Earnings ratio of TXN to the average of the S&P500 Index (24.32), we can say TXN is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 35.25 | ||
| Fwd PE | 31.17 |
4.2 Price Multiples
- TXN's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. TXN is cheaper than 72.57% of the companies in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of TXN is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 84.22 | ||
| EV/EBITDA | 23.34 |
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.
- The excellent profitability rating of TXN may justify a higher PE ratio.
- A more expensive valuation may be justified as TXN's earnings are expected to grow with 13.64% in the coming years.
PEG (NY)5.31
PEG (5Y)N/A
EPS Next 2Y9.18%
EPS Next 3Y13.64%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 3.00%, TXN has a reasonable but not impressive dividend return.
- TXN's Dividend Yield is rather good when compared to the industry average which is at 0.51. TXN pays more dividend than 95.58% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, TXN pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3% |
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
- TXN pays out 98.66% of its income as dividend. This is not a sustainable payout ratio.
- The dividend of TXN is growing, but earnings are growing more, so the dividend growth is sustainable.
DP98.66%
EPS Next 2Y9.18%
EPS Next 3Y13.64%
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.
What is the valuation status of TEXAS INSTRUMENTS INC (TXN) stock?
ChartMill assigns a valuation rating of 3 / 10 to TEXAS INSTRUMENTS INC (TXN). This can be considered as Overvalued.
How profitable is TEXAS INSTRUMENTS INC (TXN) stock?
TEXAS INSTRUMENTS INC (TXN) has a profitability rating of 8 / 10.
What is the expected EPS growth for TEXAS INSTRUMENTS INC (TXN) stock?
The Earnings per Share (EPS) of TEXAS INSTRUMENTS INC (TXN) is expected to grow by 6.63% in the next year.
Can you provide the dividend sustainability for TXN stock?
The dividend rating of TEXAS INSTRUMENTS INC (TXN) is 7 / 10 and the dividend payout ratio is 98.66%.