TEXAS INSTRUMENTS INC (TXN) Stock Fundamental Analysis
USA - NASDAQ:TXN - US8825081040 - Common Stock
163.57 USD
+4.21 (+2.64%)
163.57 USD
0 (0%)
Overall TXN gets a fundamental rating of 6 out of 10. We evaluated TXN against 112 industry peers in the Semiconductors & Semiconductor Equipment industry. TXN scores excellent on profitability, but there are some minor concerns on its financial health. TXN has a decent growth rate and is not valued too expensively. Finally 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.
TXN had a positive operating cash flow in the past year.
Each year in the past 5 years TXN has been profitable.
In the past 5 years TXN always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 14.33%, TXN belongs to the best of the industry, outperforming 87.50% of the companies in the same industry.
The Return On Equity of TXN (30.17%) is better than 91.07% of its industry peers.
TXN has a Return On Invested Capital of 16.57%. This is amongst the best in the industry. TXN outperforms 90.18% of its industry peers.
The Average Return On Invested Capital over the past 3 years for TXN is significantly above the industry average of 11.04%.
The 3 year average ROIC (24.88%) for TXN is well above the current ROIC(16.57%). The reason for the recent decline needs to be investigated.
| 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
The Profit Margin of TXN (29.05%) is better than 89.29% of its industry peers.
TXN's Profit Margin has declined in the last couple of years.
TXN's Operating Margin of 34.82% is amongst the best of the industry. TXN outperforms 92.86% of its industry peers.
In the last couple of years the Operating Margin of TXN has declined.
Looking at the Gross Margin, with a value of 57.48%, TXN belongs to the top of the industry, outperforming 82.14% of the companies in the same industry.
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.
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
The debt/assets ratio for TXN is higher compared to a year ago.
2.2 Solvency
TXN has an Altman-Z score of 8.25. This indicates that TXN is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of TXN (8.25) is better than 68.75% of its industry peers.
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.
TXN has a Debt to FCF ratio (6.75) which is in line with its industry peers.
A Debt/Equity ratio of 0.81 indicates that TXN is somewhat dependend on debt financing.
TXN's Debt to Equity ratio of 0.81 is on the low side compared to the rest of the industry. TXN is outperformed by 81.25% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | 6.75 | ||
| Altman-Z | 8.25 |
ROIC/WACC1.42
WACC11.64%
2.3 Liquidity
A Current Ratio of 4.45 indicates that TXN has no problem at all paying its short term obligations.
With a decent Current ratio value of 4.45, TXN is doing good in the industry, outperforming 67.86% of the companies in the same industry.
A Quick Ratio of 2.90 indicates that TXN has no problem at all paying its short term obligations.
TXN's Quick ratio of 2.90 is fine compared to the rest of the industry. TXN outperforms 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
The Earnings Per Share is expected to grow by 16.92% on average over the next years. This is quite good.
The Revenue is expected to grow by 10.29% on average over the next years. This is quite good.
EPS Next Y8.86%
EPS Next 2Y13.6%
EPS Next 3Y15.48%
EPS Next 5Y16.92%
Revenue Next Year13.8%
Revenue Next 2Y11.91%
Revenue Next 3Y11.16%
Revenue Next 5Y10.29%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
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
A Price/Earnings ratio of 29.90 indicates a quite expensive valuation of TXN.
Based on the Price/Earnings ratio, TXN is valued a bit cheaper than the industry average as 75.89% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of TXN to the average of the S&P500 Index (26.13), we can say TXN is valued inline with the index average.
Based on the Price/Forward Earnings ratio of 24.42, the valuation of TXN can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TXN indicates a somewhat cheap valuation: TXN is cheaper than 72.32% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.35. TXN is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.9 | ||
| Fwd PE | 24.42 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TXN indicates a somewhat cheap valuation: TXN is cheaper than 70.54% of the companies listed 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 | 71.49 | ||
| EV/EBITDA | 19.25 |
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 15.48% in the coming years.
PEG (NY)3.38
PEG (5Y)N/A
EPS Next 2Y13.6%
EPS Next 3Y15.48%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.54%, 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 2.14. TXN pays more dividend than 94.64% of the companies in the same industry.
TXN's Dividend Yield is a higher than the S&P500 average which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.54% |
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 its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
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 2Y13.6%
EPS Next 3Y15.48%
163.57
+4.21 (+2.64%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners91.03%
Inst Owner Change-0.44%
Ins Owners0.22%
Ins Owner Change-0.09%
Market Cap148.71B
Revenue(TTM)17.27B
Net Income(TTM)5.02B
Analysts68.18
Price Target190.1 (16.22%)
Short Float %1.73%
Short Ratio2.15
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.54% |
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)-2.98%
EPS NQ rev (1m)-9.17%
EPS NQ rev (3m)-9.23%
EPS NY rev (1m)-0.26%
EPS NY rev (3m)0.52%
Revenue NQ rev (1m)-1.9%
Revenue NQ rev (3m)-1.9%
Revenue NY rev (1m)-0.12%
Revenue NY rev (3m)-0.22%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.9 | ||
| Fwd PE | 24.42 | ||
| P/S | 8.61 | ||
| P/FCF | 71.49 | ||
| P/OCF | 21.56 | ||
| P/B | 8.94 | ||
| P/tB | 12.36 | ||
| EV/EBITDA | 19.25 |
EPS(TTM)5.47
EY3.34%
EPS(NY)6.7
Fwd EY4.09%
FCF(TTM)2.29
FCFY1.4%
OCF(TTM)7.59
OCFY4.64%
SpS18.99
BVpS18.29
TBVpS13.23
PEG (NY)3.38
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 | 8.25 |
F-Score7
WACC11.64%
ROIC/WACC1.42
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 Y8.86%
EPS Next 2Y13.6%
EPS Next 3Y15.48%
EPS Next 5Y16.92%
Revenue 1Y (TTM)9.9%
Revenue growth 3Y-5.17%
Revenue growth 5Y1.69%
Sales Q2Q%14.24%
Revenue Next Year13.8%
Revenue Next 2Y11.91%
Revenue Next 3Y11.16%
Revenue Next 5Y10.29%
EBIT growth 1Y9.37%
EBIT growth 3Y-16.01%
EBIT growth 5Y-1.25%
EBIT Next Year50.61%
EBIT Next 3Y27.29%
EBIT Next 5Y22.04%
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 8.86% in the next year.