Texas Instruments (TXN) closed at $266.54 in the latest trading session, marking a +1.82% move from the prior day. The stock’s change was more than the S&P 500’s daily gain of 0.72%. Elsewhere, the Dow gained 0.2%, while the tech-heavy Nasdaq added 1.57%.
Coming into today, shares of the chipmaker had lost 3.51% in the past month. In that same time, the Computer and Technology sector gained 5.02%, while the S&P 500 gained 3.68%.
Investors will be eagerly watching for the performance of Texas Instruments in its upcoming earnings disclosure. The company is forecasted to report an EPS of $2.37, showcasing a 60.14% upward movement from the corresponding quarter of the prior year. Meanwhile, the latest consensus estimate predicts the revenue to be $5.91 billion, indicating a 24.69% increase compared to the same quarter of the previous year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $8.42 per share and revenue of $21.7 billion. These totals would mark changes of +54.5% and +22.73%, respectively, from last year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Texas Instruments. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts’ favorable outlook on the business health and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, there’s been a 0.82% rise in the Zacks Consensus EPS estimate. Texas Instruments is holding a Zacks Rank of #2 (Buy) right now.
Looking at valuation, Texas Instruments is presently trading at a Forward P/E ratio of 31.1. This represents a discount compared to its industry average Forward P/E of 37.
We can also see that TXN currently has a PEG ratio of 1.03. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. By the end of yesterday’s trading, the Semiconductor – General industry had an average PEG ratio of 0.72.
