TEXAS INSTRUMENTS INC (TXN)
US8825081040 - Common Stock
We assign a fundamental rating of 6 out of 10 to TXN. TXN was compared to 108 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.
1. Profitability
1.1 Basic Checks
TXN had positive earnings in the past year.
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 13.99%, TXN belongs to the best of the industry, outperforming 84.26% of the companies in the same industry.
TXN's Return On Equity of 28.61% is amongst the best of the industry. TXN outperforms 90.74% of its industry peers.
TXN has a Return On Invested Capital of 15.20%. This is amongst the best in the industry. TXN outperforms 88.89% of its industry peers.
The Average Return On Invested Capital over the past 3 years for TXN is significantly above the industry average of 11.24%.
The last Return On Invested Capital (15.20%) for TXN is well below the 3 year average (31.77%), which needs to be investigated, but indicates that TXN had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.99% | ||
| ROE | 28.61% | ||
| ROIC | 15.2% |
ROA(3y)27.8%
ROA(5y)27.97%
ROE(3y)52.04%
ROE(5y)54.54%
ROIC(3y)31.77%
ROIC(5y)31.43%
1.3 Margins
Looking at the Profit Margin, with a value of 31.44%, TXN belongs to the top of the industry, outperforming 92.59% of the companies in the same industry.
In the last couple of years the Profit Margin of TXN has remained more or less at the same level.
The Operating Margin of TXN (34.99%) is better than 95.37% of its industry peers.
TXN's Operating Margin has been stable in the last couple of years.
TXN has a better Gross Margin (58.63%) than 82.41% of its industry peers.
TXN's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 34.99% | ||
| PM (TTM) | 31.44% | ||
| GM | 58.63% |
OM growth 3Y0.75%
OM growth 5Y-0.33%
PM growth 3Y-1.34%
PM growth 5Y1.05%
GM growth 3Y-0.63%
GM growth 5Y-0.69%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), TXN is creating value.
The number of shares outstanding for TXN has been increased compared to 1 year ago.
Compared to 5 years ago, TXN has less shares outstanding
TXN has a worse debt/assets ratio than last year.
2.2 Solvency
TXN has an Altman-Z score of 9.11. This indicates that TXN is financially healthy and has little risk of bankruptcy at the moment.
TXN has a Altman-Z score of 9.11. This is in the better half of the industry: TXN outperforms 75.00% of its industry peers.
The Debt to FCF ratio of TXN is 9.46, which is on the high side as it means it would take TXN, 9.46 years of fcf income to pay off all of its debts.
TXN's Debt to FCF ratio of 9.46 is in line compared to the rest of the industry. TXN outperforms 54.63% of its industry peers.
TXN has a Debt/Equity ratio of 0.74. This is a neutral value indicating TXN is somewhat dependend on debt financing.
TXN's Debt to Equity ratio of 0.74 is on the low side compared to the rest of the industry. TXN is outperformed by 81.48% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.74 | ||
| Debt/FCF | 9.46 | ||
| Altman-Z | 9.11 |
ROIC/WACC0.99
WACC15.36%
2.3 Liquidity
A Current Ratio of 4.31 indicates that TXN has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 4.31, TXN is in the better half of the industry, outperforming 68.52% of the companies in the same industry.
TXN has a Quick Ratio of 3.14. This indicates that TXN is financially healthy and has no problem in meeting its short term obligations.
TXN's Quick ratio of 3.14 is fine compared to the rest of the industry. TXN outperforms 62.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 4.31 | ||
| Quick Ratio | 3.14 |
3. Growth
3.1 Past
TXN shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -30.13%.
The Earnings Per Share has been growing slightly by 4.74% on average over the past years.
Looking at the last year, TXN shows a very negative growth in Revenue. The Revenue has decreased by -13.26% in the last year.
TXN shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.11% yearly.
EPS 1Y (TTM)-30.13%
EPS 3Y6.71%
EPS 5Y4.74%
EPS Q2Q%-20.54%
Revenue 1Y (TTM)-13.26%
Revenue growth 3Y6.6%
Revenue growth 5Y2.11%
Sales Q2Q%-8.41%
3.2 Future
The Earnings Per Share is expected to grow by 11.45% on average over the next years. This is quite good.
The Revenue is expected to grow by 6.85% on average over the next years.
EPS Next Y-27.1%
EPS Next 2Y-8.45%
EPS Next 3Y2.31%
EPS Next 5Y11.45%
Revenue Next Year-11.71%
Revenue Next 2Y-1.12%
Revenue Next 3Y3.74%
Revenue Next 5Y6.85%
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
With a Price/Earnings ratio of 34.73, TXN can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of TXN indicates a somewhat cheap valuation: TXN is cheaper than 62.96% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of TXN to the average of the S&P500 Index (27.73), we can say TXN is valued slightly more expensively.
Based on the Price/Forward Earnings ratio of 31.58, the valuation of TXN can be described as expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TXN is on the same level as its industry peers.
The average S&P500 Price/Forward Earnings ratio is at 22.83. TXN is valued slightly more expensive when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.73 | ||
| Fwd PE | 31.58 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TXN is valued a bit cheaper than 67.59% of the companies in the same industry.
TXN's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 116.12 | ||
| EV/EBITDA | 24.28 |
4.3 Compensation for Growth
TXN has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)7.32
EPS Next 2Y-8.45%
EPS Next 3Y2.31%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.95%, TXN has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.31, TXN pays a better dividend. On top of this TXN pays more dividend than 91.67% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.34, TXN pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.95% |
5.2 History
The dividend of TXN is nicely growing with an annual growth rate of 13.63%!
TXN has paid a dividend for at least 10 years, which is a reliable track record.
TXN has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)13.63%
Div Incr Years21
Div Non Decr Years26
5.3 Sustainability
95.87% of the earnings are spent on dividend by TXN. This is not a sustainable payout ratio.
The dividend of TXN is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP95.87%
EPS Next 2Y-8.45%
EPS Next 3Y2.31%
TEXAS INSTRUMENTS INC
NASDAQ:TXN (12/20/2024, 8:00:01 PM)
After market: 186.87 0 (0%)186.87
+2.4 (+1.3%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners91.78%
Inst Owner Change-0.72%
Ins Owners0.22%
Ins Owner Change-1.88%
Market Cap170.47B
Analysts65.64
Price Target210.84 (12.83%)
Short Float %2.05%
Short Ratio3.27
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.95% |
Dividend Growth(5Y)13.63%
DP95.87%
Div Incr Years21
Div Non Decr Years26
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.66%
Min EPS beat(2)3.53%
Max EPS beat(2)5.79%
EPS beat(4)4
Avg EPS beat(4)5.27%
Min EPS beat(4)0.57%
Max EPS beat(4)11.19%
EPS beat(8)8
Avg EPS beat(8)4.57%
EPS beat(12)12
Avg EPS beat(12)6.25%
EPS beat(16)15
Avg EPS beat(16)7.66%
Revenue beat(2)0
Avg Revenue beat(2)-0.63%
Min Revenue beat(2)-1.01%
Max Revenue beat(2)-0.24%
Revenue beat(4)1
Avg Revenue beat(4)-0.71%
Min Revenue beat(4)-1.97%
Max Revenue beat(4)0.38%
Revenue beat(8)3
Avg Revenue beat(8)-0.35%
Revenue beat(12)7
Avg Revenue beat(12)1.7%
Revenue beat(16)10
Avg Revenue beat(16)2.61%
PT rev (1m)0.46%
PT rev (3m)0.11%
EPS NQ rev (1m)0.06%
EPS NQ rev (3m)-14.08%
EPS NY rev (1m)0.01%
EPS NY rev (3m)-1.61%
Revenue NQ rev (1m)0.03%
Revenue NQ rev (3m)-6.95%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.45%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.73 | ||
| Fwd PE | 31.58 | ||
| P/S | 10.85 | ||
| P/FCF | 116.12 | ||
| P/OCF | 27.3 | ||
| P/B | 9.87 | ||
| P/tB | 13.45 | ||
| EV/EBITDA | 24.28 |
EPS(TTM)5.38
EY2.88%
EPS(NY)5.92
Fwd EY3.17%
FCF(TTM)1.61
FCFY0.86%
OCF(TTM)6.84
OCFY3.66%
SpS17.22
BVpS18.93
TBVpS13.9
PEG (NY)N/A
PEG (5Y)7.32
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.99% | ||
| ROE | 28.61% | ||
| ROCE | 17.38% | ||
| ROIC | 15.2% | ||
| ROICexc | 21.02% | ||
| ROICexgc | 26.29% | ||
| OM | 34.99% | ||
| PM (TTM) | 31.44% | ||
| GM | 58.63% | ||
| FCFM | 9.34% |
ROA(3y)27.8%
ROA(5y)27.97%
ROE(3y)52.04%
ROE(5y)54.54%
ROIC(3y)31.77%
ROIC(5y)31.43%
ROICexc(3y)51.71%
ROICexc(5y)50.46%
ROICexgc(3y)75.15%
ROICexgc(5y)80.42%
ROCE(3y)36.32%
ROCE(5y)35.92%
ROICexcg growth 3Y-23.4%
ROICexcg growth 5Y-18.12%
ROICexc growth 3Y-14.3%
ROICexc growth 5Y-11.06%
OM growth 3Y0.75%
OM growth 5Y-0.33%
PM growth 3Y-1.34%
PM growth 5Y1.05%
GM growth 3Y-0.63%
GM growth 5Y-0.69%
F-Score3
Asset Turnover0.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.74 | ||
| Debt/FCF | 9.46 | ||
| Debt/EBITDA | 1.84 | ||
| Cap/Depr | 322.27% | ||
| Cap/Sales | 30.4% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 89.47% | ||
| Profit Quality | 29.72% | ||
| Current Ratio | 4.31 | ||
| Quick Ratio | 3.14 | ||
| Altman-Z | 9.11 |
F-Score3
WACC15.36%
ROIC/WACC0.99
Cap/Depr(3y)317.79%
Cap/Depr(5y)219.9%
Cap/Sales(3y)18.78%
Cap/Sales(5y)13.34%
Profit Quality(3y)56.73%
Profit Quality(5y)77.03%
High Growth Momentum
Growth
EPS 1Y (TTM)-30.13%
EPS 3Y6.71%
EPS 5Y4.74%
EPS Q2Q%-20.54%
EPS Next Y-27.1%
EPS Next 2Y-8.45%
EPS Next 3Y2.31%
EPS Next 5Y11.45%
Revenue 1Y (TTM)-13.26%
Revenue growth 3Y6.6%
Revenue growth 5Y2.11%
Sales Q2Q%-8.41%
Revenue Next Year-11.71%
Revenue Next 2Y-1.12%
Revenue Next 3Y3.74%
Revenue Next 5Y6.85%
EBIT growth 1Y-31.48%
EBIT growth 3Y7.4%
EBIT growth 5Y1.77%
EBIT Next Year-6.29%
EBIT Next 3Y12.55%
EBIT Next 5Y13.35%
FCF growth 1Y-75.22%
FCF growth 3Y-37.37%
FCF growth 5Y-25.95%
OCF growth 1Y-30.89%
OCF growth 3Y1.5%
OCF growth 5Y-2.24%