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Texas Instruments (NASDAQ:TXN – Get Free Report) and Energous (NASDAQ:WATT – Get Free Report) are both technology companies, but which is the better stock? We will compare the two companies based on the strength of their risk, valuation, dividends, analyst recommendations, profitability, institutional ownership and earnings.

Analyst Ratings This is a summary of recent ratings and recommmendations for Texas Instruments and Energous, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score Texas Instruments 4 8 15 2 2.52 Energous 1 1 0 0 1.50 Texas Instruments presently has a consensus price target of $312.12, indicating a potential upside of 20.55%. Given Texas Instruments’ stronger consensus rating and higher possible upside, research analysts clearly believe Texas Instruments is more favorable than Energous.

Volatility and Risk Texas Instruments has a beta of 1.33, suggesting that its share price is 33% more volatile than the S&P 500. Comparatively, Energous has a beta of 1.56, suggesting that its share price is 56% more volatile than the S&P 500. Valuation & Earnings This table compares Texas Instruments and Energous”s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio Texas Instruments $17.68 billion 13.37 $5.00 billion $6.57 39.41 Energous $5.63 million 10.76 -$9.59 million ($2.21) -4.95 Texas Instruments has higher revenue and earnings than Energous. Energous is trading at a lower price-to-earnings ratio than Texas Instruments, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership 85.0% of Texas Instruments shares are owned by institutional investors. Comparatively, 4.3% of Energous shares are owned by institutional investors. 0.6% of Texas Instruments shares are owned by company insiders. Comparatively, 0.2% of Energous shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability This table compares Texas Instruments and Energous’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets Texas Instruments 31.11% 35.77% 17.31% Energous -76.37% -28.67% -24.91% Summary Texas Instruments beats Energous on 14 of the 15 factors compared between the two stocks.

(Get Free Report)

Texas Instruments Incorporated designs, manufactures, and sells semiconductors to electronics designers and manufacturers in the United States and internationally. The company operates through Analog and Embedded Processing segments. The Analog segment offers power products to manage power requirements across various voltage levels, including battery-management solutions, DC/DC switching regulators, AC/DC and isolated controllers and converters, power switches, linear regulators, voltage references, and lighting products. This segment provides signal chain products that sense, condition, and measure signals to allow information to be transferred or converted for further processing and control, including amplifiers, data converters, interface products, motor drives, clocks, and logic and sensing products. The Embedded Processing segment offers microcontrollers that are used in electronic equipment; digital signal processors for mathematical computations; and applications processors for specific computing activity. This segment offers products for use in various markets, such as industrial, automotive, personal electronics, communications equipment, enterprise systems, and calculators and other. It provides DLP products primarily for use in project high-definition images; calculators; and application-specific integrated circuits. The company markets and sells its semiconductor products through direct sales and distributors, as well as through its website. Texas Instruments Incorporated was founded in 1930 and is headquartered in Dallas, Texas.

About Energous (Get Free Report)

Energous Corporation provides wireless charging system solutions in the United States. The company develops WattUp wireless power networks technology that consists of semiconductor chipsets; software controls; hardware designs; and antennas that enables radio frequency-based charging for Internet of Things devices. Its products are used in asset trackers; sensors; retail displays; and security devices; smart home; medical; industrial; and other sensors; electronic shelf labeling; logistics and asset tracking tags and sensors; computer mice and keyboards; remote controls; gaming consoles and controllers; hearing aids; rechargeable batteries; automotive accessories; smart textiles; wearables; and medical devices. The company was formerly known as DvineWave Inc. and changed its name to Energous Corporation in January 2014. Energous Corporation was incorporated in 2012 and is headquartered in San Jose; California.

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Key Takeaways Global chip sales rose 6.4% sequentially in July, extending growth to 17 straight months.NVDA leads the group with a 93.3% expected current-year earnings growth rate.ACMR's consensus earnings estimate jumped 49.6% over the past 60 days. Semiconductor stocks have had an impressive year so far after a stellar 2025. Higher demand, driven by continued enthusiasm surrounding artificial intelligence (AI), has made chip stocks one of the most lucrative buys.

Although concerns grew a few months back about the potential of AI stocks given the massive investments being made by big tech companies, the fears have gradually eased after robust earnings from AI giants reinstalled investors’ confidence.

Given the upbeat sentiment, it would be ideal to invest in semiconductor stocks, such as Analog Devices (ADI - Free Report) , Taiwan Semiconductor Manufacturing Company Limited (TSM - Free Report) , Texas Instruments (TXN - Free Report) , NVIDIA Corporation (NVDA - Free Report) and ACM Research, Inc. (ACMR - Free Report) , which have great potential for growth this year.

Semiconductor Market Continues to Expand

Global semiconductor sales totaled $146.8 billion in July, up 6.4% sequentially from June’s total of $137.9 billion, the Semiconductor Industry Association (“SIA”) reported last week. Year over year, semiconductor sales surged 135.1% in July from last year’s total of $62.5 billion. 

John Neuffer, SIA president and CEO, said, “The global semiconductor market grew on a month-to-month basis for the 17th consecutive month in July, and the industry has already reached its highest-ever annual global sales total just seven months into the year.”

Global semiconductor sales have now grown for 17 straight months. Chip sales have also grown in all seven months this year.

AI-related semiconductor stocks came under pressure a couple of months back, as concerns grew over the potential of AI and whether the rapid growth can be sustained. This saw investors rotating out of AI-related chip stocks and taking refuge in more defensive assets.

However, major AI-related semiconductor companies reported robust earnings and issued impressive forecasts last quarter, which have fizzled out the fears, sending chip stocks on a rally once again. 

Semiconductor companies have played a major role in driving the broader market’s gains in recent years. The robust jump in July follows a stellar first and second quarter for chip stocks. Worldwide semiconductor sales totaled $403.3 billion in the second quarter of 2026 and $298.5 billion in the first quarter, surging 33.1% and 25% sequentially, respectively. 

Semiconductors have become an essential part of almost every modern and emerging technology, powering developments in areas such as the Internet of Things (IoT), 6G connectivity and artificial intelligence.

Rising demand from the automotive industry has also helped drive chip sales higher. At the same time, the AI sector remains in the early stages of its growth, prompting major technology companies to invest billions of dollars in AI research, development and infrastructure.

With these companies continuing to ramp up spending on AI infrastructure, investor sentiment toward semiconductor stocks has remained strong.

5 Semiconductor Stocks With UpsideAnalog DevicesAnalog Devices is an original equipment manufacturer of semiconductor devices, specifically analog, mixed-signal and digital signal processing (“DSP”) integrated circuits. ADI’s product line comprises amplifiers and comparators; analog-to-digital converters; digital-to-analog converters; video encoders and decoders; embedded processing products and DSPs; MEMS and temperature sensors; RF/IF components and converters; power and thermal management ICs, audio/video converters, amplifiers, CODECs, filters and processors. Analog Devices also offers analog, digital and RF switches and multiplexers; analog microcontrollers; clock and timing products.

Analog Devices’ expected earnings growth rate for the current year is 66.4%. The Zacks Consensus Estimate for current-year earnings has improved 5.2% over the past 60 days. ADI currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Taiwan Semiconductor Manufacturing Company LimitedTaiwan Semiconductor Manufacturing Company Limited is the world's largest dedicated integrated circuit foundry. TSM manufactures ICs for its customers based on their proprietary IC designs using its advanced production processes. Taiwan Semiconductor Manufacturing Company Limited’s goal is to establish itself as one of the world's leading semiconductor companies by building upon the strengths that have made it the world's leading IC foundry.

Taiwan Semiconductor Manufacturing Company Limited’s expected earnings growth rate for the current year is 55.1%. The Zacks Consensus Estimate for current-year earnings has improved 7.6% over the past 60 days. TSM presently carries a Zacks Rank #1.

Texas InstrumentsTexas Instruments is an original equipment manufacturer of analog, mixed-signal and digital signal-processing integrated circuits. TXN has manufacturing and design facilities, including wafer fabrication and assembly/test operations in North America, Asia and Europe. Management strategy has been to build assets that would be fully utilized through their lifetimes and outsource any excess demand in peak situations to outside foundries.

Texas Instruments’ expected earnings growth rate for the current year is 55.1%. The Zacks Consensus Estimate for current-year earnings has improved 10.3% over the past 60 days. Currently, TXN carries a Zacks Rank #2.

NVIDIA CorporationNVIDIA Corporation is the worldwide leader in visual computing technologies and the inventor of the graphics processing unit, or GPU. Over the years, NVDA’s focus has evolved from PC graphics to AI-based solutions that now support high-performance computing, gaming and virtual reality platforms.

NVIDIA has an expected earnings growth rate of 93.3% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 4.2% over the last 60 days. NVDA currently has a Zacks Rank #1.

ACM ResearchACM Research, Inc. develops, manufactures and sells single-wafer wet cleaning equipment, which semiconductor manufacturers can use in numerous manufacturing steps to remove particles, contaminants and other random defects. ACMR is headquartered in Fremont, CA.

ACM Research’s expected earnings growth rate for the current year is 27.3%. The Zacks Consensus Estimate for current-year earnings has improved 49.6% over the past 60 days. ACMR sports a Zacks Rank #1 at present.

Key Takeaways Texas Instruments' Q2'26 revenues rose 23%, while non-GAAP EPS jumped 52% year over year.TXN's data center revenues doubled year over year in Q2'26 and increased 20% sequentially.Texas Instruments plans to produce more than 95% of its wafers internally by 2030. Texas Instruments Incorporated (TXN - Free Report) has emerged as one of the better-performing semiconductor stocks this year, but that outperformance comes with a catch — investors are now paying a premium for the company's growth prospects.

Texas Instruments currently trades at around 26.97 times forward 12-month earnings, well above the 20.22 times for the broader Zacks Computer and Technology sector. The stock also carries a Value Score of D, signaling that valuation is clearly stretched.

Texas Instruments Forward 12-Month P/E Ratio
Image Source: Zacks Investment Research

TXN looks expensive compared with several semiconductor companies, including Amtech Systems, Inc. (ASYS - Free Report) , NVIDIA Corporation (NVDA - Free Report) and Analog Devices, Inc. (ADI - Free Report) . Amtech Systems trades at 12.25 times forward 12-month earnings, while NVIDIA and Analog Devices trade at 17.44 times and 22.49 times, respectively.

The premium is harder to ignore after TXN shares have gained 46.8% year to date compared with a 15.5% rise for the sector. Semiconductor peers, Amtech Systems, NVIDIA and Analog Devices, have gained 16.3%, 20.2% and 30.9%, respectively.

Texas Instruments YTD Price Return Performance
Image Source: Zacks Investment Research

Given the sharp rally, investors may question whether the stock has already priced in much of its future growth.

Yet there is a strong argument for staying bullish. Texas Instruments' earnings are accelerating, exposure to AI infrastructure is expanding, and manufacturing investments could strengthen its competitive position. These factors suggest that the company's valuation deserves a closer look rather than being dismissed simply because it is above the sector average.

Strong Financial Results Support TXN’s Premium ValuationTexas Instruments' recent financial performance provides an important reason for investors to accept a higher valuation. Its second-quarter 2026 revenues rose 23% year over year to $5.46 billion, while non-GAAP earnings per share (EPS) jumped 52% to $2.14. The stronger earnings growth is particularly encouraging because it shows that improving demand is translating into meaningful bottom-line gains.

Texas Instruments expects this momentum to continue. Third-quarter revenue guidance of $5.65-$6.15 billion represents roughly 25% year-over-year growth at the midpoint. The midpoint of the EPS guidance, at $2.40, implies nearly 62% year-over-year growth. The guidance reflects healthy demand across several markets, particularly those tied to AI infrastructure.

Wall Street shares the same optimism. The Zacks Consensus Estimate calls for continued revenue and earnings growth in both 2026 and 2027, reinforcing confidence that the company's growth story is far from over.

TXN Sales and EPS Growth Rate Estimates
Image Source: Zacks Investment Research

AI Infrastructure Gives TXN an Attractive Growth OpportunityTexas Instruments is not competing with NVIDIA or AMD in AI accelerators, but it is quietly becoming an important beneficiary of the AI boom. The company supplies analog and embedded chips that perform critical functions inside AI infrastructure.

Its analog and embedded chips manage power, process signals, support connectivity and control equipment used throughout data centers and other industrial systems. As AI servers become more power-hungry, the amount of supporting semiconductor content required also increases.

Instead of competing in the crowded AI processor market, the company is benefiting from the broader AI infrastructure buildout. This positions Texas Instruments to capture AI spending regardless of which GPU (graphics processing unit) maker ultimately dominates the data center market.

The numbers already reflect this trend. Texas Instruments' data center business reached an annual revenue run rate of approximately $1.2 billion in 2025, growing more than 50% year over year. During the second quarter of 2026, data center revenues doubled from the prior-year quarter and increased 20% sequentially.

Such strong growth suggests AI infrastructure could become an increasingly important revenue driver over the coming years. If AI data center investment remains strong, TXN's exposure could expand without requiring the company to compete directly in the highly competitive accelerator market.

Manufacturing Investments Could Strengthen TXN’s MoatTexas Instruments is also investing heavily to bring more manufacturing in-house. Unlike many semiconductor companies that depend heavily on third-party foundries, TXN plans to produce more than 95% of its wafers internally by 2030.

While this strategy requires substantial capital spending, it could provide greater control over supply and improve cost efficiency. That could become an important competitive advantage as semiconductor demand grows.

Government support should also help reduce the financial burden. Texas Instruments expects to receive up to $1.6 billion in direct CHIPS Act grant and another $6-$8 billion from the U.S. Treasury Department's Investment Tax Credit. Including both, total lifetime benefits are estimated between $7.5 billion and $9.5 billion. These incentives should reduce expansion costs and boost profitability over the long run.

TXN’s Strong Cash Flow Adds Support to the Investment CaseTexas Instruments' cash generation further strengthens its ability to invest while returning capital to shareholders. Over the past 12 months, the company generated $8.67 billion in operating cash flow and $6.53 billion in free cash flow. It ended the second quarter with $7 billion in cash and short-term investments.

The company also continues to reward investors. During the first half of 2026, TXN returned nearly $1.45 billion through dividends and share repurchases. Over the past year, total shareholder returns approached $6 billion.

The strong cash position allows Texas Instruments to invest aggressively in manufacturing expansion while continuing to reward shareholders.

Final Thoughts: Is TXN’s Premium Valuation Justified?Premium valuations are often justified when a company consistently delivers earnings growth, generates strong cash flow and maintains durable competitive advantages.

Texas Instruments fits that profile. The company continues to benefit from expanding AI infrastructure spending, delivers consistent earnings growth, generates substantial free cash flow, maintains a healthy balance sheet and has a long track record of rewarding shareholders through dividends and share buybacks. Those strengths make its premium valuation easier to justify.

Currently, Texas Instruments carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Industrial segment recovery and rapid Data Center expansion, supported by the Nvidia partnership, are key drivers for Texas Instruments' revised five-year average revenue growth forecast of 13.5%. Data Center is projected to grow from 8.6% of total revenue in 2025 to 25.2% by 2028, contributing up to 65.7% of total revenue growth by then. While Texas Instruments' Data Center partnership with Nvidia is not exclusive, its broad Analog portfolio positions it to capture significant end-market growth despite competitive risks.

The analog/mixed-signal semiconductor market is poised for solid growth this year, following a strong 2025. Macro and geopolitical developments remain overhangs, with capacity constraints in certain mature and specialty processes increasingly tightening supply and supporting prices.

We expect that these concerns will be overridden by the cyclical recovery in semiconductors coupled with strong end market demand from AI, industrial automation and automotive. We think there may be significant opportunity here and our bets are particularly on MACOM Technology (MTSI - Free Report) , Monolithic Power (MPWR - Free Report) and Semtech Corp (SMTC - Free Report) .

 2026 growth data from World Semiconductor Trade Statistics (WSTS) – provided in Spring 2026 – projects 90% growth in semiconductors this year, mainly driven by memory, which is expected to grow around 250%. The analog segment is expected to grow a relatively sedate 10% because of its greater exposure to the industrial and auto markets. However, the recovery in these markets, along with AI-related demand, is providing additional support.

 While valuations appear rich compared to the broader tech sector as well as the S&P benchmark, risk appears limited given the significant growth levers that could support multi-year expansion.

About the Industry The electronic gadgets we use to accurately read our commands, and record, store, retrieve and process the information we throw at them run on semiconductor technology, whether analog (enabling the recording and measurement of real-world information), digital (processing information available in machine-readable language) or mixed signal (enabling conversion of analog signals to digital or digital to analog among other things). Most electronic gadgets use a combination of these components, whether in consumer, industrial, auto, medical, communications, or IoT and other markets.

The industry is cyclical and prices are elastic. Players usually serve multiple markets that offset their individual seasonality, or focus on certain core markets for which they have highly differentiated technology and relationships.

Growth Prospects Strong Despite Macro and Geopolitics The rapid growth of artificial intelligence and data-center infrastructure has emerged as an increasingly important growth driver for the analog and mixed-signal semiconductor industry. AI computing is increasing demand not only for GPUs and memory but also for the supporting semiconductor infrastructure required to power, connect and control increasingly dense computing systems. AI data centers require sophisticated power-management and power-delivery solutions, high-speed signal conditioning, optical and electrical connectivity, timing components and thermal-management technologies. As AI clusters scale, rising power consumption and increasing data-transfer speeds are driving greater semiconductor content per system, creating significant opportunities for suppliers of analog, mixed-signal, power and high-speed connectivity products.Analog and mixed-signal semiconductor demand continues to be driven by several powerful and interconnected secular trends. Foremost among them is the rapid electrification of transportation, particularly the rise of electric vehicles, which significantly increases demand for analog components such as power management ICs, battery monitoring systems and sensor interfaces. Closely related is the expansion of IoT and edge devices, where billions of connected nodes rely on mixed-signal chips with ultra-low power consumption. Industrial automation is another major driver, as smart factories and Industry 4.0 applications depend heavily on precise sensing, control systems and predictive maintenance enabled by these technologies. In parallel, the rollout of 5G and advanced connectivity infrastructure is fueling demand for high-performance RF components, data converters and timing solutions that rely on mixed-signal integration. Additionally, the global energy transition is accelerating the need for advanced power management systems in renewable energy, EV charging and smart grid applications, making power analog the largest segment in the market. While consumer electronics continue to contribute, their growth has matured, shifting focus from volume expansion to increased functionality per device, which still raises analog content. While elevated memory prices are likely to pressure consumer electronics and other memory-intensive applications, AI infrastructure spending is increasingly offsetting this weakness. Consequently, the outlook for analog and mixed-signal semiconductors is becoming increasingly differentiated by end market rather than being uniformly cyclical.In general, semiconductor pricing is robust when capacity is tight and utilization high. Companies start adding capacity when they anticipate the next big growth cycle which usually continues for several years. AI is a major driver of the current build cycle and AI demand is expected to remain strong for years to come, lengthening the cycle and supporting prices. Supply chain efficiency also has an effect on chip prices. The significant increase in chip demand is driven by AI, data centers, IoT and EVs and strategic imperatives for countries in the race to technological superiority. However, capacity constraints are becoming increasingly evident in certain mature and specialty processes, including 200mm manufacturing platforms commonly used for analog, power and other mature-node semiconductor products. AI-related demand is competing for some of the same manufacturing resources, and foundries are also reallocating capacity toward higher-margin products. Therefore, pricing should remain relatively resilient in the foreseeable future, particularly for differentiated products and those facing capacity constraints.The push toward greater system integration and application-specific solutions is significantly reshaping the analog/mixed-signal industry. The need to reduce system cost, power consumption and physical footprint is driving companies to integrate analog, digital, sensing, processing and connectivity functions into highly integrated solutions. This shift is being enabled by advanced process technologies like CMOS scaling and specialized nodes (for example SOI and BiCMOS). This raises the technical complexity of design, especially in noise isolation, signal integrity and mixed-signal verification, increasing development time and demand for specialized analog design talent. It can also increase the value per chip, as customers pay more for integrated solutionsthat reduce system complexity and development costs. Leading analog and mixed-signal companies like TXN, ADI, Infineon, STM and NXP are increasingly developing highly integrated, application-specific solutions, particularly in automotive, industrial and communications markets. Zacks Industry Rank Indicates Strong Growth Prospects The Zacks Semiconductor – Analog and Mixed industry is housed within the broader Zacks Computer and Technology sector. It carries a Zacks Industry Rank of #23, which places it in the top 9% of the nearly 250 Zacks-classified industries. The group’s Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates improving near-term prospects.

Our research shows that the top 50% of the Zacks-ranked industries outperforms the bottom 50% by a factor of more than 2 to 1. The industry’s positioning in the top 50% of Zacks-ranked industries is based on the earnings outlook of the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions over the past year, we see that 2026 estimates have been rising more or less steadily over the past year, though more significantly so in the last four months.

For 2027 as well, the more significant increases have come in the last four months. Overall, the 2026 estimate has increased 34.6% over the past year, while the 2027 estimate has increased 32.5%.

Before we present a few stocks that you may want to consider for your portfolio, let’s take a look at the industry’s recent stock-market performance and valuation picture.

Stock Market Performance Shows Solid Returns The Semiconductor – Analog and Mixed industry currently trades at a premium to both the broader Zacks Computer and Technology sector and the S&P 500.

Overall, the industry has gained 37.4% over the past year while the broader sector gained 29.9% and the S&P 500 gained 20.8%.

One-Year Price Performance

Image Source: Zacks Investment Research

Industry's Current Valuation a Premium On the basis of forward 12-month price-to-earnings (P/E) ratio, the industry is trading at a 23.22X multiple, which is a 17.5% discount to its median value over the past year. It is however a 12.4% premium to the broader market’s 20.65X as well as a 15.5% premium to the S&P 500’s 20.1X.

The industry has traded between the 23.22X and 36.39X multiples over the past year.

Forward 12 Month Price-to-Earnings (P/E) Ratio

Image Source: Zacks Investment Research

3 Stocks Worth Buying Despite growing macro uncertainty, a cyclical recovery and strong industrial and AI demand are serving as powerful tailwinds for the industry. The following stocks are worth a closer look:

MACOM Technology Solutions (MTSI - Free Report) : Headquartered in Lowell, Massachusetts, MACOM designs and manufactures high-performance semiconductor products for the data center, telecommunications, and industrial and defense markets. MACOM’s semiconductor solutions are used across high-speed optical networking, wireless infrastructure, radar, aerospace and defense, and high-performance computing applications.

The company is benefiting from strong AI infrastructure demand, an expanding optical connectivity portfolio and emerging opportunities in satellite communications. A key growth driver is the rapid buildout of AI data centers, which require increasingly high-speed, low-latency connections between processors, switches and other components. MACOM supplies critical optical and analog components used in these connectivity systems, positioning it as an important semiconductor supplier to AI networking infrastructure. The company is expanding its exposure to higher-speed optical technologies, with solutions supporting 800G and 1.6T connectivity and emerging 3.2T architectures.

MACOM is also expanding its opportunity in satellite communications, particularly as low-Earth orbit (LEO) networks drive demand for higher-frequency and higher-bandwidth connectivity. Its RF and optical solutions support satellite communications, providing an additional growth opportunity beyond traditional telecommunications and data centers.

That said, MACOM’s growth is increasingly tied to the AI data-center investment cycle, creating exposure to a potentially cyclical and concentrated market. Its dependence on hyperscalers could amplify this risk, as delays or reductions in customer capital spending could materially affect demand. Competition in optical connectivity could pressure pricing and margins as higher-speed technologies become more standardized. The company also faces execution risks as it ramps 1.6T and 3.2T products, particularly as competition intensifies in next-generation optical connectivity. Meanwhile, satellite communications remains an emerging opportunity and is not yet a significant contributor to revenue.

MACOM‘s third quarter earnings beat the Zacks Consensus Estimate by 4.5%. The estimates for fiscal years 2026 and 2027 (ending September) are up 45 cents (9.1%) and $1.49 (22.7%), respectively, in the last 30 days. This represents revenue and earnings growth of a respective 36.8% and 55% in 2026 and 35.8% and 49.7% in 2027.

Shares of this Zacks Rank #1 (Strong Buy) company have appreciated 105.8% in the past year.

Price and Consensus: MTSI

Image Source: Zacks Investment Research

Monolithic Power Systems, Inc. (MPWR): Headquartered in Kirkland, Washington, Monolithic is a fabless semiconductor company that develops high-performance power-management and power-conversion solutions. The company serves a diversified range of markets, including storage and computing, enterprise data, automotive, communications, consumer and industrial applications.

MPWR is increasingly positioned to benefit from the rapid rise in power requirements across AI infrastructure and other high-performance computing applications, with recent results indicating a significant acceleration in demand. Total revenue increased 47.6% year over year in the second quarter of 2026, highlighting the strength of the company’s overall growth trajectory. Enterprise Data revenue surged 164.3% year over year in the quarter, on the back of 97.7% growth in quarter one, after declining 2% in 2025.

The sharp rebound reflects accelerating demand for AI and server power-management solutions, positioning Enterprise Data as an increasingly important growth driver for the company. As AI servers require increasingly dense and efficient power delivery, the company stands to benefit from rising power content per system as it develops more compact, high-power and efficient solutions, advanced packaging technologies and next-generation architectures such as 800V data-center power.

Importantly, growth extends beyond AI: communications revenue was up 78.3% in the quarter, while automotive and industrial increased 8.2% and 17.3%, respectively. In 2025, automotive revenue grew 43.1%, communications 36.8%, storage and computing 46.0% and industrial 35.3%. This diversification implies multiple secular growth avenues while reducing reliance on any single market. Its increasingly integrated power solutions and modules can further increase content per system across served markets, strengthening customer relationships and supporting the company’s long-term growth opportunity.

Given the recent growth trajectory, expectations for AI-driven growth have risen sharply, increasing the risk of disappointment if data-center capital spending slows or is delayed. Sustaining triple-digit Enterprise Data growth will also become more difficult as the base expands, while customer concentration and dependence on large hyperscalers could make revenue growth more volatile if customers alter their spending plans.

The company faces additional execution risks as it ramps next-generation architectures such as 800V data-center power. Competition remains intense, while a premium valuation leaves limited room for execution shortfalls and could result in significant multiple compression if AI growth moderates.

Monolithic Power‘s second quarter earnings beat the Zacks Consensus Estimate by 10.5%. The estimates for fiscal years 2026 and 2027 (ending December) are up $2.93 (12.1%) and $4.88 (16.3%), respectively, in the last 30 days. This works out to expected revenue and earnings growth of 46.4% and 52.6% in 2026 and 26.3% and 28.1% in 2027.

Shares of the Zacks Rank #1 company have appreciated 51.7% in the past year.

Price and Consensus: MPWR

Image Source: Zacks Investment Research

Semtech Corporation (SMTC): Camarillo, California-based Semtech is a semiconductor and connectivity company providing high-performance solutions for data centers, communications infrastructure, industrial applications and IoT. Its portfolio spans high-speed signal-integrity products for optical and copper data communications, analog and mixed-signal solutions, and wireless connectivity technologies including LoRa®. The company also provides IoT modules, gateways and connectivity solutions supporting cellular and other wireless networks.

Semtech is benefiting from improving demand across its data-center, industrial and IoT businesses, with recent results showing accelerating growth and expanding margins. Data-center revenue increased 91% year over year in the latest quarter, outpacing 33% growth in total company revenue, as AI-driven increases in bandwidth and connectivity requirements support demand for its optical and connectivity products. FiberEdge and CopperEdge products position the company to benefit from rising bandwidth requirements, as increasingly demanding applications drive higher component content per system.

Beyond data centers, LoRa-enabled solutions are supporting growth in industrial and IoT applications by providing low-power, long-range connectivity for connected devices and infrastructure. The improving growth profile is translating into stronger operating leverage, with Q2 FY2027 adjusted operating margin expanding to 24.4% from 18.8% a year earlier.

The combination of accelerating data-center demand, expanding content per system, growing IoT adoption and strong margin expansion provides a solid foundation for sustained earnings growth.The stock increasingly reflects the AI/data-center opportunity but must execute successfully on a rapid transition toward higher-speed optical connectivity. At the same time, it remains meaningfully exposed to cyclical markets. If AI spending slows, the company’s other businesses may not be strong enough to offset weaker data-center demand, leaving the shares vulnerable to a pullback.

Semtech topped earnings estimates in the second quarter of fiscal 2027 (ending January). The Zacks Consensus Estimate for 2027 is up 67 cents (25.2%) in the last seven days with the 2027 estimate jumping $1.56 (42.7%) in the same period. Revenue and earnings are expected to increase a respective 41.5% and 94.7% in 2027 and a respective 27.5% and 56.5% the following year.

SMTC shares, ranked #1, have gained 128.9% in the past year.

Price and Consensus: SMTC

Image Source: Z

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Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Avanda Investment Management Pte. Ltd. purchased a new position in Texas Instruments Incorporated (NASDAQ:TXN – Free Report) during the second quarter, according to its most recent Form 13F filing with the SEC. The fund purchased 7,000 shares of the semiconductor company’s stock, valued at approximately $2,086,000. Texas Instruments makes up about 0.7% of Avanda Investment Management Pte. Ltd.’s investment portfolio, making the stock its 14th biggest holding.

Several other hedge funds and other institutional investors also recently made changes to their positions in the stock. High Point Wealth Management LLC bought a new position in Texas Instruments in the 4th quarter worth about $25,000. Strategic Wealth Investment Group LLC purchased a new stake in shares of Texas Instruments during the second quarter valued at approximately $25,000. Advocate Investing Services LLC bought a new stake in shares of Texas Instruments during the fourth quarter valued at approximately $25,000. Ares Financial Consulting LLC purchased a new position in Texas Instruments in the 4th quarter worth approximately $26,000. Finally, Cornerstone Financial Management LLC purchased a new position in Texas Instruments in the 4th quarter worth approximately $27,000. Hedge funds and other institutional investors own 84.99% of the company’s stock.

Texas Instruments Price Performance Shares of NASDAQ TXN opened at $264.36 on Friday. The firm has a market cap of $241.43 billion, a PE ratio of 40.24, a PEG ratio of 1.04 and a beta of 1.33. Texas Instruments Incorporated has a one year low of $152.73 and a one year high of $334.03. The firm has a fifty day moving average of $290.51 and a 200 day moving average of $258.75. The company has a debt-to-equity ratio of 0.72, a quick ratio of 3.44 and a current ratio of 4.86.

Texas Instruments (NASDAQ:TXN – Get Free Report) last issued its earnings results on Wednesday, July 22nd. The semiconductor company reported $2.14 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $1.91 by $0.23. Texas Instruments had a return on equity of 35.77% and a net margin of 31.11%.The business had revenue of $5.46 billion during the quarter, compared to the consensus estimate of $5.26 billion. During the same period last year, the company earned $1.41 EPS. The company’s revenue for the quarter was up 22.8% on a year-over-year basis. Texas Instruments has set its Q3 2026 guidance at 2.230-2.570 EPS. As a group, research analysts predict that Texas Instruments Incorporated will post 8.42 EPS for the current fiscal year. Texas Instruments Dividend Announcement The company also recently declared a quarterly dividend, which was paid on Tuesday, August 11th. Investors of record on Friday, July 31st were issued a dividend of $1.42 per share. This represents a $5.68 annualized dividend and a yield of 2.1%. The ex-dividend date of this dividend was Friday, July 31st. Texas Instruments’s dividend payout ratio is currently 86.45%.

More Texas Instruments News Here are the key news stories impacting Texas Instruments this week:

Positive Sentiment: Operational recovery is accelerating. Texas Instruments’ second-quarter results showed revenue growth of roughly 23%, operating profit up 48%, and net income up 53%. Free cash flow also improved 56% as capital spending nearly halved year over year, suggesting the company’s heavy investment cycle may be easing. Texas Instruments: The $6.5 Billion Cash-Flow Machine Is Finally Awake Positive Sentiment: AI and data-center exposure support the long-term outlook. Analysts and fund commentary characterize TXN as a “picks-and-shovels” beneficiary of AI infrastructure, electric vehicles, industrial automation, and factory equipment because its analog chips help power and control these systems. Texas Instruments Is a Worthy AI Picks-and-Shovels Play I Keep Buying Positive Sentiment: TXN retains broad-based momentum. In comparisons with Analog Devices, coverage points to Texas Instruments’ improving manufacturing utilization and strength across multiple end markets, potentially giving it an edge despite ADI’s stronger industrial and automotive trends. ADI vs. TXN: Which Analog Processing Chip Stock Has an Edge Right Now? Neutral Sentiment: Options-market volatility has risen. Surging implied volatility indicates increased uncertainty and the potential for larger price swings, but it does not establish a clear directional signal. Implied Volatility Surging for Texas Instruments Stock Options Negative Sentiment: Post-earnings performance remains a concern. TXN has decreased 6.8% since its latest quarterly report, with investors apparently looking beyond the earnings beat and focusing on forward estimates, elevated expectations, and whether the recovery can continue. Why Is Texas Instruments Down 6.8% Since Last Earnings Report? Wall Street Analysts Forecast Growth Several research analysts have weighed in on TXN shares. Weiss Ratings upgraded Texas Instruments from a “hold (c+)” rating to a “buy (b-)” rating in a research note on Tuesday, July 28th. Benchmark upped their price objective on Texas Instruments from $315.00 to $360.00 and gave the stock a “buy” rating in a report on Thursday, July 23rd. Susquehanna boosted their price target on shares of Texas Instruments from $300.00 to $340.00 and gave the stock a “positive” rating in a research report on Tuesday, July 21st. Sanford C. Bernstein boosted their price target on shares of Texas Instruments from $250.00 to $290.00 and gave the stock a “market perform” rating in a research report on Thursday, July 23rd. Finally, Arete Research set a $405.00 price objective on shares of Texas Instruments and gave the company a “buy” rating in a research report on Wednesday, July 29th. Two analysts have rated the stock with a Strong Buy rating, fifteen have assigned a Buy rating, eight have issued a Hold rating and four have given a Sell rating to the stock. According to data from MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and an average target price of $312.12.

View Our Latest Report on Texas Instruments

Texas Instruments Profile (Free Report)

Texas Instruments Inc (NASDAQ: TXN) is a global semiconductor company headquartered in Dallas, Texas, that designs and manufactures analog and embedded processing chips. The company’s products are used across a wide range of end markets, including industrial, automotive, personal electronics, communications and enterprise equipment. TI’s business emphasizes components that condition, convert, manage and move electrical signals—capabilities that are foundational to modern electronic systems.

TI’s product portfolio includes a broad array of analog integrated circuits—such as power management, amplifiers, data converters and interface devices—as well as embedded processors and microcontrollers used to control systems and run real-time applications.

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Investors in Texas Instruments Incorporated (TXN - Free Report) need to pay close attention to the stock based on moves in the options market lately. That is because the Aug. 21, 2026 $185 Call had some of the highest implied volatility of all equity options today.

What is Implied Volatility?Implied volatility shows how much movement the market is expecting in the future. Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It could also mean there is an event coming up soon that may cause a big rally or a huge sell-off. However, implied volatility is only one piece of the puzzle when putting together an options trading strategy.

What do the Analysts Think?Clearly, options traders are pricing in a big move for Texas Instruments shares, but what is the fundamental picture for the company? Currently, Texas Instruments is a Zacks Rank #2 (Buy) in the Semiconductor – General industry that ranks in the Top 14% of our Zacks Industry Rank. Over the last 30 days, seven analysts have increased their earnings estimates for the current quarter, while none dropped the estimates. The net effect has taken our Zacks Consensus Estimate for the current quarter from $2.08 per share to $2.37 in that period.

Given the way analysts feel about Texas Instruments right now, this huge implied volatility could mean there’s a trade developing. Oftentimes, options traders look for options with high levels of implied volatility to sell premium. This is a strategy many seasoned traders use because it captures decay. At expiration, the hope for these traders is that the underlying stock does not move as much as originally expected.

Advisors Capital Management LLC bought a new stake in shares of Texas Instruments Incorporated (NASDAQ:TXN – Free Report) in the 2nd quarter, according to its most recent filing with the SEC. The institutional investor bought 332,170 shares of the semiconductor company’s stock, valued at approximately $99,010,000. Texas Instruments comprises 1.0% of Advisors Capital Management LLC’s holdings, making the stock its 20th biggest position.

A number of other hedge funds have also made changes to their positions in TXN. HBW Advisory Services LLC raised its holdings in Texas Instruments by 2.2% in the first quarter. HBW Advisory Services LLC now owns 1,730 shares of the semiconductor company’s stock valued at $336,000 after acquiring an additional 37 shares in the last quarter. Montz Harcus Wealth Management LLC grew its holdings in Texas Instruments by 2.9% during the 1st quarter. Montz Harcus Wealth Management LLC now owns 1,338 shares of the semiconductor company’s stock worth $260,000 after acquiring an additional 38 shares in the last quarter. Livforsakringsbolaget Skandia Omsesidigt grew its holdings in Texas Instruments by 0.6% during the 1st quarter. Livforsakringsbolaget Skandia Omsesidigt now owns 5,960 shares of the semiconductor company’s stock worth $1,157,000 after acquiring an additional 38 shares in the last quarter. Absher Wealth Management LLC increased its position in shares of Texas Instruments by 1.0% in the 1st quarter. Absher Wealth Management LLC now owns 4,223 shares of the semiconductor company’s stock worth $820,000 after purchasing an additional 42 shares during the last quarter. Finally, Severin Investments LLC increased its position in shares of Texas Instruments by 3.3% in the 1st quarter. Severin Investments LLC now owns 1,349 shares of the semiconductor company’s stock worth $262,000 after purchasing an additional 43 shares during the last quarter. Institutional investors and hedge funds own 84.99% of the company’s stock.

Texas Instruments Trading Down 0.7%
Texas Instruments stock opened at $265.60 on Friday. The firm’s 50-day moving average is $291.25 and its 200-day moving average is $258.71. The company has a debt-to-equity ratio of 0.72, a quick ratio of 3.44 and a current ratio of 4.86. Texas Instruments Incorporated has a 1 year low of $152.73 and a 1 year high of $334.03. The company has a market cap of $242.56 billion, a P/E ratio of 40.43, a PEG ratio of 1.05 and a beta of 1.33.

Texas Instruments (NASDAQ:TXN – Get Free Report) last posted its quarterly earnings results on Wednesday, July 22nd. The semiconductor company reported $2.14 EPS for the quarter, beating the consensus estimate of $1.91 by $0.23. Texas Instruments had a net margin of 31.11% and a return on equity of 35.77%. The business had revenue of $5.46 billion during the quarter, compared to analyst estimates of $5.26 billion. During the same period in the previous year, the business posted $1.41 EPS. The company’s quarterly revenue was up 22.8% on a year-over-year basis. Texas Instruments has set its Q3 2026 guidance at 2.230-2.570 EPS. On average, equities analysts expect that Texas Instruments Incorporated will post 8.42 earnings per share for the current year.
Texas Instruments Dividend Announcement
The business also recently announced a quarterly dividend, which was paid on Tuesday, August 11th. Shareholders of record on Friday, July 31st were paid a $1.42 dividend. This represents a $5.68 dividend on an annualized basis and a yield of 2.1%. The ex-dividend date was Friday, July 31st. Texas Instruments’s payout ratio is presently 86.45%.

Wall Street Analysts Forecast Growth
TXN has been the topic of several research analyst reports. Citigroup reaffirmed a “buy” rating on shares of Texas Instruments in a research report on Tuesday, July 14th. Wells Fargo & Company boosted their price objective on Texas Instruments from $300.00 to $310.00 and gave the company an “equal weight” rating in a report on Thursday, July 23rd. Robert W. Baird upped their price objective on Texas Instruments from $300.00 to $385.00 and gave the company an “outperform” rating in a research note on Thursday, July 23rd. KeyCorp increased their target price on Texas Instruments from $390.00 to $400.00 and gave the stock an “overweight” rating in a report on Thursday, July 23rd. Finally, Benchmark lifted their target price on Texas Instruments from $315.00 to $360.00 and gave the stock a “buy” rating in a research report on Thursday, July 23rd. Two investment analysts have rated the stock with a Strong Buy rating, fifteen have given a Buy rating, eight have given a Hold rating and four have issued a Sell rating to the company. According to MarketBeat.com, the stock presently has a consensus rating of “Moderate Buy” and an average target price of $312.12.

Get Our Latest Analysis on TXN

Texas Instruments Profile
(Free Report)

Texas Instruments Inc (NASDAQ: TXN) is a global semiconductor company headquartered in Dallas, Texas, that designs and manufactures analog and embedded processing chips. The company’s products are used across a wide range of end markets, including industrial, automotive, personal electronics, communications and enterprise equipment. TI’s business emphasizes components that condition, convert, manage and move electrical signals—capabilities that are foundational to modern electronic systems.

TI’s product portfolio includes a broad array of analog integrated circuits—such as power management, amplifiers, data converters and interface devices—as well as embedded processors and microcontrollers used to control systems and run real-time applications.

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Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Stock to Watch: Texas Instruments (TXN - Free Report) Headquartered in Dallas, TX, Texas Instruments, Inc. is an original equipment manufacturer of analog, mixed signal and digital signal processing (DSP) integrated circuits.

TXN is a #2 (Buy) on the Zacks Rank, with a VGM Score of B.

Additionally, the company could be a top pick for growth investors. TXN has a Growth Style Score of A, forecasting year-over-year earnings growth of 54.5% for the current fiscal year.

11 analysts revised their earnings estimate upwards in the last 60 days for fiscal 2026. The Zacks Consensus Estimate has increased $0.76 to $8.42 per share. TXN boasts an average earnings surprise of +8.3%.

With a solid Zacks Rank and top-tier Growth and VGM Style Scores, TXN should be on investors' short list.

Key Takeaways Texas Instruments' automotive revenues rose mid-teens year over year and high-single digits sequentially.Stronger EV and hybrid demand in China and lower customer inventories are supporting TXN's auto recovery.TXN sees the automotive recovery in its early stages, with potential for bigger second-half growth. Texas Instruments Incorporated (TXN - Free Report) is seeing a meaningful improvement in automotive demand, adding another growth driver as the semiconductor industry enters a broader recovery. In the second quarter of 2026, automotive revenues increased in the mid-teens year over year and rose at a high-single-digit rate sequentially. This was a clear acceleration from earlier quarters and came alongside strong growth in industrial and data center markets.

Texas Instruments attributed the automotive improvement partly to stronger demand for electric vehicles (EVs) and hybrids, particularly in China. Lower customer inventories also appear to be supporting orders as automakers replenish supplies. The company believes the recovery is still in its early stages, suggesting automotive could contribute more meaningfully to growth during the second half of 2026.

The opportunity is significant because automotive electronics require increasing amounts of analog and embedded chips as vehicles become more electrified and connected. The broader recovery is already showing up in Texas Instruments’ quarterly performance. Second-quarter revenues climbed 23% to $5.46 billion, while operating profit jumped 48%. The company’s third-quarter revenue guidance of $5.65-$6.15 billion indicates a year-over-year increase in the 19-29% range, suggesting continued growth momentum.

The automotive rebound strengthens Texas Instruments’ growth outlook. If EV, hybrid and broader auto demand continue improving, the market could become an increasingly important contributor to TXN’s 2026 growth. The Zacks Consensus Estimate for the company’s 2026 revenues is currently pegged at $21.7 billion, indicating year-over-year growth of 22.7%.

How Do Competitors Fare Against TXN in Auto Chips?Analog Devices, Inc. (ADI - Free Report) remains a strong rival to Texas Instruments in analog semiconductors. In the second quarter of fiscal 2026, Analog Devices generated $3.62 billion in revenues, up 37% year over year. Automotive represented 24% of second-quarter revenues and increased 2% year over year and 8% sequentially to $871.6 million, reflecting better demand and content gains.

During the last earnings call, management stated that Analog Devices is capturing share in next-generation ADAS and infotainment systems, supported by higher demand for its GMSL, functionally safe power and A2B technologies. The company also noted that its battery management system solutions for EVs returned to year-over-year growth for the first time in two years, while the same platform supports energy storage systems. For the third quarter, Analog Devices expects Automotive to grow mid- to high-single digits sequentially at the midpoint of guidance, suggesting continued growth momentum for the segment.

ON Semiconductor (ON - Free Report) has a more direct automotive focus, particularly in power semiconductors. In the second quarter of 2026, automotive revenues rose 7% year over year to $781 million, while total revenues climbed 9% to $1.6 billion.

China remained a key growth area for ON Semiconductor. Automotive revenues in the country rose 13% during the first half of 2026 despite a 4% decline in total vehicle sales. The company expects China automotive silicon carbide revenues to increase 60-70% in 2026 as market-share gains and new vehicle programs ramp up. ON Semiconductor expects automotive revenues to increase by a low-single-digit percentage sequentially in the third quarter.

TXN’s Price Performance, Valuation and EstimatesShares of Texas Instruments have surged 63.1% year to date compared with the Zacks Semiconductor - General industry’s 28.2% growth.

Texas Instruments YTD Price Return Performance
Image Source: Zacks Investment Research

From a valuation standpoint, TXN trades at a forward price-to-earnings ratio of 30.31, significantly higher than the industry’s average of 22.98.

Texas Instruments Forward 12-Month P/E Ratio
Image Source: Zacks Investment Research

The Zacks Consensus Estimate for Texas Instruments’ 2026 and 2027 earnings implies a year-over-year increase of 54.5% and 17.3%, respectively. Estimates for 2026 and 2027 have been revised upward over the past 30 days.

Image Source: Zacks Investment Research

Texas Instruments currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Key Takeaways Texas Instruments returned $5.8B to shareholders as trailing 12-month free cash flow climbed to $6.5B.TXN's second-quarter revenues rose 23% year over year, while operating profit surged 48%.TXN expects 2026 capital spending of $2B-$3B, down about 34%-56% from the 2025 level.
Texas Instruments Incorporated (TXN - Free Report) is showing that its improving business momentum is translating into stronger cash generation, raising the question of whether bigger shareholder payouts could follow. The company returned $5.8 billion to shareholders over the past 12 months through dividends and share repurchases.

Texas Instruments’ robust cash flow generation ability is aiding its aggressive shareholder return policy. TXN generated $6.5 billion of free cash flow (FCF) over the trailing 12 months, up sharply from $1.8 billion a year earlier. FCF represented 33.6% of revenues compared with 10.6% in the prior-year period. Operating cash flow also climbed 35% to $8.7 billion.

Improving business conditions should provide further support for share buybacks and dividend payments. Second-quarter revenues jumped 23% year over year to $5.46 billion, while operating profit surged 48%.

A decline in capital expenditure is also anticipated to help Texas Instruments boost shareholders’ returns. Over the past few years, TXN invested aggressively in new 300-millimeter wafer fabrication plants and assembly and test facilities to expand internal manufacturing capacity. In 2025, capital expenditures totaled approximately $4.55 billion.

The spending pace is now easing. In the first half of 2026, Texas Instruments’ capital expenditures were $676 million, significantly down from $1.31 billion in the same period of last year. Management expects 2026 capital expenditures to be between $2 billion and $3 billion, about a 34% to 56% reduction from the 2025 level. This shift could significantly improve the company’s FCF and strengthen its ability to return more capital to shareholders.

Texas Instruments is benefiting from broadening demand across industrial, data center and automotive markets, while its analog and embedded processing franchises support durable long-term growth. With these key growth catalysts, TXN appears increasingly capable of enhancing shareholder returns. The Zacks Consensus Estimate for TXN’s 2026 revenues is pegged at $21.7 billion, indicating a 22.7% year-over-year increase.

TXN’s Rivals With Strong Cash Returns: ADI and ONAnalog Devices, Inc. (ADI - Free Report) is a close rival to Texas Instruments in analog chips and offers a strong shareholder-return profile. During second-quarter 2026 results, Analog Devices revealed that it generated FCF of $4.6 billion in the trailing 12 months, equal to 36% of revenues, and returned $5 billion to shareholders. Analog Devices also maintains a long record of dividend growth, supporting its appeal to income-focused investors.

ON Semiconductor Corporation (ON - Free Report) is another relevant competitor, particularly in power and automotive semiconductors. During second-quarter 2026 results, ON Semiconductor disclosed that it generated $1.5 billion in FCF. The company repurchased $1.5 billion of stock during the period, bringing shareholder returns to roughly 100% of FCF in the trailing 12 months. ON Semiconductor’s AI data-center business is also expected to more than double in 2026, potentially strengthening future cash generation.

TXN’s Price Performance, Valuation and EstimatesShares of Texas Instruments have rallied 59.4% year to date compared with the Zacks Semiconductor - General industry’s 24% growth.

Texas Instruments YTD Price Return Performance
Image Source: Zacks Investment Research

From a valuation standpoint, TXN trades at a forward price-to-earnings ratio of 29.69, significantly higher than the industry’s average of 22.30.

Texas Instruments Forward 12-Month P/E Ratio
Image Source: Zacks Investment Research

The Zacks Consensus Estimate for Texas Instruments’ 2026 and 2027 earnings implies a year-over-year increase of 54.5% and 17.3%, respectively. Estimates for 2026 and 2027 have been revised upward over the past seven days.

Image Source: Zacks Investment Research

Texas Instruments currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Here are three stocks with buy rank and strong momentum characteristics for investors to consider today, August 6:

Northern Trust Corporation (NTRS - Free Report) : This wealth management company has a Zacks Rank #1 and witnessed the Zacks Consensus Estimate for its current year earnings increasing 8.3% over the last 60 days.

Northern Trust’s shares gained 15.2% over the last three months compared with the S&P 500’s advance of 5.4%. The company possesses a Momentum Score  of A.

ASM International NV (ASMIY - Free Report) : This developer and supplier of semiconductor manufacturing equipment, materials, and support services worldwide has a Zacks Rank #1 and witnessed the Zacks Consensus Estimate for its next year earnings increasing 9.5% over the last 60 days.

ASM International’s shares gained 13.1% over the last six months compared with the S&P 500’s advance of 11.2%. The company possesses a Momentum Score of A.

Texas Instruments Incorporated (TXN - Free Report) : This semiconductor supplier to electronics designers and manufacturers has a Zacks Rank #1 and witnessed the Zacks Consensus Estimate for its current year earnings increasing 9% over the last 60 days.

Texas Instruments’ shares gained 26.9% over the last six months compared with the S&P 500’s advance of 11.2%. The company possesses a Momentum Score of A.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Learn more about the Momentum score and how it is calculated here.

Here are three stocks with buy rank and strong income characteristics for investors to consider today, August 6:

CTO Realty Growth, Inc. (CTO - Free Report) : This publicly traded real estate investment trust has witnessed the Zacks Consensus Estimate for its current year earnings increasing 5.2% over the last 60 days.

This Zacks Rank #1 company has a dividend yield of nearly 7%, compared with the industry average of 4%.

ING Group N.V. (ING - Free Report) : This banking company has witnessed the Zacks Consensus Estimate for its current year earnings increasing 6.5% over the last 60 days.

This Zacks Rank #1 company has a dividend yield of 4.1%, compared with the industry average of 2.6%.

Texas Instruments Incorporated (TXN - Free Report) : This semiconductor supplier to electronics designers and manufacturers has witnessed the Zacks Consensus Estimate for its current year earnings increasing 9% over the last 60 days.

This Zacks Rank #1 company has a dividend yield of 2%, compared with the industry average of 0.5%.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Find more top income stocks with some of our great premium screens.

LOUISVILLE, Ky.--(BUSINESS WIRE)--GE Appliances, a Haier company, today announced that it will integrate US-manufactured, Texas Instruments (TI) microcontrollers, Wi-Fi® connectivity solutions, and analog components into its next generation of connected appliances. TI semiconductors will be used to supply one-third of the chips for products made in GE Appliances' new laundry plant at its Louisville, Kentucky headquarters, with production expected to begin in 2027. This investment translates to.

Texas Instruments (TXN - Free Report) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.

Over the past month, shares of this chipmaker have returned -7.1%, compared to the Zacks S&P 500 composite's +1.9% change. During this period, the Zacks Semiconductor - General industry, which Texas Instruments falls in, has lost 2.3%. The key question now is: What could be the stock's future direction?

While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.

Earnings Estimate RevisionsRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.

We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For the current quarter, Texas Instruments is expected to post earnings of $2.32 per share, indicating a change of +56.8% from the year-ago quarter. The Zacks Consensus Estimate has changed +15.5% over the last 30 days.

For the current fiscal year, the consensus earnings estimate of $8.35 points to a change of +53.2% from the prior year. Over the last 30 days, this estimate has changed +8.9%.

For the next fiscal year, the consensus earnings estimate of $9.83 indicates a change of +17.7% from what Texas Instruments is expected to report a year ago. Over the past month, the estimate has changed +12.1%.

With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #1 (Strong Buy) for Texas Instruments.

The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:

12 Month EPS

Projected Revenue GrowthWhile earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth.

For Texas Instruments, the consensus sales estimate for the current quarter of $5.91 billion indicates a year-over-year change of +24.7%. For the current and next fiscal years, $21.6 billion and $24.2 billion estimates indicate +22.1% and +12% changes, respectively.

Last Reported Results and Surprise HistoryTexas Instruments reported revenues of $5.46 billion in the last reported quarter, representing a year-over-year change of +22.8%. EPS of $2.14 for the same period compares with $1.41 a year ago.

Compared to the Zacks Consensus Estimate of $5.22 billion, the reported revenues represent a surprise of +4.57%. The EPS surprise was +12.04%.

Over the last four quarters, Texas Instruments surpassed consensus EPS estimates three times. The company topped consensus revenue estimates three times over this period.

ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.

Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.

As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.

Texas Instruments is graded F on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.

Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Texas Instruments. However, its Zacks Rank #1 does suggest that it may outperform the broader market in the near term.

Key Takeaways TXN topped Q2 2026 revenues and earnings estimates as margins and EPS climbed year over year.TXN expects Q3 revenues of $5.65-$6.15 billion and EPS of $2.23-$2.57 with a 13% tax rate.TXN is benefiting from AI data center demand and its analog and embedded chip portfolio across key markets. Texas Instruments Inc. (TXN - Free Report) — a major original equipment manufacturer of analog, mixed-signal and digital signal processing integrated circuits — reported strong second-quarter 2026 earnings results, easily surpassing the Zacks Consensus Estimate with respect to both the top and bottom lines.

TXN continues to deliver robust profitability improvement. Gross margin reached 61.4% from 57.9% in the year-ago quarter, while operating margin expanded to 42.3% from 35.1%. Driven by higher revenues and improved margins, second-quarter earnings per share jumped 52% year over year.

Texas Instruments is benefiting from solid AI-powered data center demand, which is boosting its prospects in the enterprise systems market. As AI infrastructure scales from data centers to edge devices, vehicles, and industrial systems, TXN’s chips are becoming critical components in the broader buildout. 

The chart below shows the price performance of TXN year to date.

Image Source: Zacks Investment Research

Robust Product PortfolioTXN has a strong position in the foundational analog and embedded processing semiconductor markets, which are critical for long-term growth in key industries like industrial, automotive, personal electronics and AI data centers.

As cloud and AI workloads continue to rise, TXN’s strong portfolio and manufacturing scale position it well to benefit from sustained demand for efficient, high-performance power solutions in data center infrastructure.

TXN provides supplies foundational analog, power management and edge-processing semiconductors to corporate bigwigs like NVIDIA Corp. (NVDA - Free Report) , Apple Inc. (AAPL - Free Report) , Ford Motor Co. (F - Free Report) and Medtronic plc (MDT - Free Report) , to name a few.

Strong Guidance TXN’s outlook calls for third-quarter 2026 revenues in the range of $5.65-$6.15 billion. The company expects earnings per share between $2.23 and $2.57. Management expects an effective tax rate of about 13% in the third quarter.

Solid Estimate RevisionsTexas Instruments has an expected revenue and earnings growth rate of 20.4% and 49.9%, respectively, for the current year. The Zacks Consensus Estimate for the current year’s earnings has improved 6.4% over the last seven days. 

TXN has an expected revenue and earnings growth rate of 11.6% and 15.2%, respectively, for the next year. The Zacks Consensus Estimate for next year’s earnings has improved 6.6% over the last seven days. 

Image Source: Zacks Investment Research

Impressive Price Upside PotentialTexas Instruments sports a Zacks Rank #1 (Strong Buy) at present and has a Zacks Momentum Score of A. You can see the complete list of today’s Zacks #1 Rank stocks here.

The short-term average price target of brokerage firms represents an increase of 13.7% from the last closing price of $279.41. The brokerage target price is currently in the range of $215-$400. This indicates a maximum upside of 43.2% and a maximum downside of 23.1%. The risk/reward ratio is a highly favorable 1:87. 

Image Source: Zacks Investment Research

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An $80,000 salary sits right at the intersection of comfortable and aspirational in the current economy. It exceeds per capita disposable personal income of $68,391 and comes in slightly above the average U.S. household’s annual expenditures of $78,535 in 2024. Replacing it entirely with portfolio income is a real target, and the capital required depends almost entirely on the yield you accept.

The 10-year Treasury near 4.6% now sets the risk-free bar. Any dividend strategy needs to earn its keep against that number. Here is what the math looks like at three yield tiers.

Conservative Tier: 3% to 4% Yield At a 3.5% blended yield, $80,000 divided by 0.035 requires roughly $2,285,000 in capital. At 4%, the requirement drops to $2,000,000. This is the range for broad dividend growth ETFs, dividend aristocrat funds, and quality large-cap equity income strategies.

Schwab U.S. Dividend Equity ETF (NYSEARCA:SCHD) sits at the heart of this tier, with an annualized forward dividend of $1.01 per share. Vanguard High Dividend Yield ETF (NYSEARCA:VYM) offers a similar profile, with a forward annualized estimate near $3.92 per share. The tradeoff is capital intensity. You need the biggest nest egg, but you also get diversified equity exposure, rising distributions over time, and principal that tends to appreciate rather than erode.

Moderate Tier: 5% to 7% Yield At 6%, $80,000 divided by 0.06 needs roughly $1,333,000. At 7%, it needs about $1,142,000. That is a full million dollars less than the conservative approach.

This tier draws from covered call equity ETFs, preferred stock funds, midstream energy partnerships, and REITs. Real-world examples in this yield band include Texas Instruments (NASDAQ:TXN | TXN Price Prediction) at a $5.68 indicated annual dividend and pipeline names like Plains All American Pipeline paying $1.67 annually per unit. Preferred share series from regional banks and REIT sponsors round out the mix. The catch: distributions grow slowly if at all, and covered call strategies cap upside during strong market years.

Aggressive Tier: 8% to 14% Yield At 10%, $80,000 requires $800,000. At 12%, roughly $666,000. At 14%, closer to $571,000. This is where the capital requirement collapses and the risk profile changes character.

These yields come from business development companies, mortgage REITs, leveraged closed-end funds, and options-income ETFs. Weekly-distribution products like the Defiance Nasdaq 100 Weekly Distribution ETF at a 6.8% indicated annual yield and various perpetual preferred stocks yielding 12% or more populate this space. Names like AGNC Investment and Prospect Capital regularly clear double digits. The tradeoff is blunt: distributions can be cut, principal frequently erodes, and total return often lags the broad market. You are harvesting income today at the cost of tomorrow’s asset base.

The Compounding Trap Most Investors Miss A 3.5% yield that grows 8% per year doubles the income stream in roughly nine years. A 12% yield that stays flat, or worse, gets trimmed 2% annually, delivers less cumulative income over 15 years than the lower-yielding growth portfolio.

Put it in $80,000 terms. The high-yield portfolio pays $80,000 today and $80,000 in year 10. The dividend growth portfolio pays roughly $56,000 in year one from a smaller income base, but crosses $80,000 around year eight and keeps climbing past $110,000 by year 12. Which retiree is better off depends on time horizon and whether principal preservation matters.

What to Do Next Recalculate the target against actual spending. Average household expenditures ran $78,535 in 2024. If your real annual outflow is $65,000, you may need closer to $1,625,000 at 4%. Compare 10-year total returns, not headline yields. Pull the total return of a dividend growth ETF against a high-yield options-income fund over the same decade. The gap frequently favors the lower yield. Benchmark every option against the ~4.6% Treasury. Any dividend security paying less than the current 10-year yield needs a clear growth or tax argument to justify the equity risk. Blend the tiers. A portfolio split between a dividend growth core and a moderate-yield sleeve often produces the $80,000 target with less capital than pure conservative and less erosion than pure aggressive. Contact [email protected] for any questions or corrections.

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Zacks #1 Rank Additions Company (Symbol) Research Texas Instruments (TXN) Analyst Report Signet Jewelers (SIG) Analyst Report Richardson Electroni... (RELL) Snapshot Report JAKKS Pacific (JAKK) Analyst Report Coursera (COUR) Snapshot Report Investment Ideas Earnings Analysis More Analysis Reported Earnings Surprises View All Positive Negative Symbol Time Expected Reported %Surprise GLPEY 02:48 0.34 0.60 +76.47 NBN 07:49 3.40 4.05 +19.12 BMRC 08:31 0.52 0.58 +11.54 BCAL 08:21 0.41 0.44 +7.32 ENSG 06:04 1.80 1.92 +6.67 EPS Positive Surprises for Jul 27, 2026

Symbol Time Expected Reported %Surprise CZWI 08:31 0.41 0.11 -73.17 PERF 06:30 0.02 0.01 -50.00 BSRR 08:02 0.89 0.77 -13.48 PDLB 07:29 0.37 0.35 -5.41 EPS Negative Surprises for Jul 27, 2026

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SummaryTexas Instruments Incorporated is positioned for margin-accretive growth, driven by robust demand in data center, industrial, and automotive markets.TXN benefits from data center power architecture shifts, manufacturing reshoring, and automation, supporting durable volume and pricing power.I expect operating margins to exceed 50% by eFY28, with strong balance sheet flexibility and capacity to scale production.I reiterate a Strong Buy rating for TXN stock with a $421/share price target at 24.50x eFY27 EV/aEBITDA, citing extended growth runway. afterday/E+ via Getty Images

Texas Instruments Incorporated (TXN) is entering a major inflection point for margin-accretive growth as the data center market continues to grow, driven by increasing demand for compute capacity. With the power infrastructure market showing support for

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Analyst’s Disclosure: I/we have a beneficial long position in the shares of TXN, GEV, CGNX, ROK, SYM either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Posted by Defense World Staff on Jul 26th, 2026

44 Wealth Management LLC acquired a new stake in shares of Texas Instruments Incorporated (NASDAQ:TXN – Free Report) during the first quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission. The firm acquired 7,506 shares of the semiconductor company’s stock, valued at approximately $1,457,000.

Several other hedge funds and other institutional investors have also bought and sold shares of the company. Van Diest Capital LLC boosted its stake in shares of Texas Instruments by 128.0% during the first quarter. Van Diest Capital LLC now owns 2,902 shares of the semiconductor company’s stock valued at $563,000 after purchasing an additional 1,629 shares during the period. Bradley Foster & Sargent Inc. CT increased its stake in shares of Texas Instruments by 2.3% in the first quarter. Bradley Foster & Sargent Inc. CT now owns 64,723 shares of the semiconductor company’s stock worth $12,565,000 after buying an additional 1,481 shares during the period. Lombard Odier Asset Management Switzerland SA increased its stake in shares of Texas Instruments by 8.7% in the first quarter. Lombard Odier Asset Management Switzerland SA now owns 47,206 shares of the semiconductor company’s stock worth $9,165,000 after buying an additional 3,796 shares during the period. Aristotle Atlantic Partners LLC bought a new stake in Texas Instruments during the 1st quarter valued at $262,000. Finally, Waverly Advisors LLC raised its holdings in Texas Instruments by 23.7% during the 1st quarter. Waverly Advisors LLC now owns 42,832 shares of the semiconductor company’s stock valued at $8,315,000 after buying an additional 8,209 shares during the last quarter. Hedge funds and other institutional investors own 84.99% of the company’s stock.

Texas Instruments Stock Performance Shares of TXN opened at $279.58 on Friday. The company has a 50-day simple moving average of $301.06 and a two-hundred day simple moving average of $247.37. The company has a debt-to-equity ratio of 0.72, a current ratio of 4.86 and a quick ratio of 2.94. The firm has a market capitalization of $254.44 billion, a PE ratio of 42.55, a price-to-earnings-growth ratio of 1.41 and a beta of 1.32. Texas Instruments Incorporated has a one year low of $152.73 and a one year high of $334.03.

Texas Instruments (NASDAQ:TXN – Get Free Report) last posted its earnings results on Wednesday, July 22nd. The semiconductor company reported $2.14 earnings per share for the quarter, topping analysts’ consensus estimates of $1.91 by $0.23. The firm had revenue of $5.46 billion for the quarter, compared to the consensus estimate of $5.26 billion. Texas Instruments had a return on equity of 35.77% and a net margin of 31.11%.The business’s revenue for the quarter was up 22.8% on a year-over-year basis. During the same quarter in the prior year, the business earned $1.41 EPS. Texas Instruments has set its Q3 2026 guidance at 2.230-2.570 EPS. On average, analysts anticipate that Texas Instruments Incorporated will post 8.17 EPS for the current fiscal year.

Texas Instruments Dividend Announcement The firm also recently disclosed a quarterly dividend, which will be paid on Tuesday, August 11th. Investors of record on Friday, July 31st will be paid a dividend of $1.42 per share. The ex-dividend date of this dividend is Friday, July 31st. This represents a $5.68 annualized dividend and a yield of 2.0%. Texas Instruments’s payout ratio is presently 86.45%.

Texas Instruments News Summary Here are the key news stories impacting Texas Instruments this week:

Positive Sentiment: Rosenblatt Securities raised its price target to $350 and kept a buy rating, while JPMorgan, TD Cowen, and KeyCorp also reiterated bullish views and lifted targets, suggesting analysts see further upside after the earnings beat. Article Positive Sentiment: Texas Instruments reported Q2 earnings of $2.14 per share on revenue of $5.46 billion, both above estimates, with revenue up 22.8% year over year and management issuing stronger forward guidance tied to industrial, data center, and automotive demand. Positive Sentiment: Commentary highlighted improving inventory levels, broad demand recovery, and strong free cash flow, all of which support the long-term investment case for TXN. Neutral Sentiment: Several articles framed TXN as a strong growth, wide-moat, or undervalued stock, reinforcing a constructive but largely unchanged fundamental outlook. Negative Sentiment: The broader semiconductor group has pulled back as investors rotate out of AI chip winners, unwind leveraged trades, and take profits after a powerful run, pressuring TXN along with the rest of the sector. Negative Sentiment: Despite the earnings beat and raised outlook, the stock sold off after the report, suggesting expectations were already very high and leaving little room for short-term disappointment. Insiders Place Their Bets In other news, VP Ahmad Bahai sold 5,000 shares of Texas Instruments stock in a transaction that occurred on Thursday, May 14th. The shares were sold at an average price of $309.13, for a total transaction of $1,545,650.00. Following the completion of the transaction, the vice president directly owned 42,519 shares in the company, valued at approximately $13,143,898.47. This trade represents a 10.52% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. Also, CEO Haviv Ilan sold 20,000 shares of the business’s stock in a transaction that occurred on Monday, May 4th. The stock was sold at an average price of $280.32, for a total value of $5,606,400.00. Following the completion of the sale, the chief executive officer directly owned 204,339 shares in the company, valued at approximately $57,280,308.48. This represents a 8.92% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last quarter, insiders have sold 199,143 shares of company stock valued at $56,959,010. Insiders own 0.60% of the company’s stock.

Analyst Upgrades and Downgrades A number of brokerages have issued reports on TXN. Truist Financial raised their price target on shares of Texas Instruments from $278.00 to $300.00 and gave the stock a “hold” rating in a report on Thursday. Susquehanna upped their price objective on shares of Texas Instruments from $300.00 to $340.00 and gave the company a “positive” rating in a research note on Tuesday. Cantor Fitzgerald reiterated a “neutral” rating on shares of Texas Instruments in a report on Monday, July 20th. TD Cowen cut their target price on Texas Instruments from $360.00 to $340.00 and set a “buy” rating on the stock in a research note on Thursday. Finally, Rosenblatt Securities boosted their price target on Texas Instruments from $330.00 to $350.00 and gave the company a “buy” rating in a report on Friday. Fourteen research analysts have rated the stock with a Buy rating, ten have issued a Hold rating and four have given a Sell rating to the company. According to MarketBeat, the stock presently has a consensus rating of “Hold” and an average target price of $308.40.

Read Our Latest Report on Texas Instruments

Texas Instruments Company Profile (Free Report)

Texas Instruments Inc (NASDAQ: TXN) is a global semiconductor company headquartered in Dallas, Texas, that designs and manufactures analog and embedded processing chips. The company’s products are used across a wide range of end markets, including industrial, automotive, personal electronics, communications and enterprise equipment. TI’s business emphasizes components that condition, convert, manage and move electrical signals—capabilities that are foundational to modern electronic systems.

TI’s product portfolio includes a broad array of analog integrated circuits—such as power management, amplifiers, data converters and interface devices—as well as embedded processors and microcontrollers used to control systems and run real-time applications.

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Bank of Nova Scotia trimmed its holdings in Texas Instruments Incorporated (NASDAQ:TXN – Free Report) by 72.5% in the first quarter, according to its most recent disclosure with the SEC. The fund owned 494,202 shares of the semiconductor company’s stock after selling 1,304,252 shares during the period. Bank of Nova Scotia owned 0.05% of Texas Instruments worth $95,944,000 at the end of the most recent reporting period.

Several other hedge funds have also made changes to their positions in TXN. State Street Corp grew its position in Texas Instruments by 0.5% in the 3rd quarter. State Street Corp now owns 43,555,112 shares of the semiconductor company’s stock valued at $8,002,381,000 after buying an additional 230,098 shares during the last quarter. Charles Schwab Investment Management Inc. raised its position in Texas Instruments by 6.7% during the 4th quarter. Charles Schwab Investment Management Inc. now owns 24,288,604 shares of the semiconductor company’s stock worth $4,213,832,000 after buying an additional 1,517,420 shares during the last quarter. Geode Capital Management LLC raised its position in Texas Instruments by 1.1% during the 4th quarter. Geode Capital Management LLC now owns 22,865,312 shares of the semiconductor company’s stock worth $3,952,933,000 after buying an additional 248,515 shares during the last quarter. Invesco Ltd. lifted its stake in shares of Texas Instruments by 10.6% in the 4th quarter. Invesco Ltd. now owns 18,184,514 shares of the semiconductor company’s stock worth $3,154,831,000 after acquiring an additional 1,749,513 shares during the period. Finally, Bank of New York Mellon Corp boosted its holdings in shares of Texas Instruments by 33.6% in the first quarter. Bank of New York Mellon Corp now owns 16,402,834 shares of the semiconductor company’s stock valued at $3,184,446,000 after acquiring an additional 4,129,601 shares in the last quarter. Institutional investors and hedge funds own 84.99% of the company’s stock.

More Texas Instruments News Here are the key news stories impacting Texas Instruments this week:

Positive Sentiment: Texas Instruments beat Q2 estimates, reporting EPS of $2.14 on revenue of $5.46 billion, with sales up 22.8% year over year and net income rising sharply. Article Title Positive Sentiment: Management also raised Q3 guidance above Wall Street expectations, signaling continued demand recovery in industrial, data center and automotive markets. Article Title Positive Sentiment: Several analysts turned more constructive: JPMorgan raised its target to $340 with an overweight rating, TD Cowen kept a buy rating and cut its target to $340, and KeyCorp lifted its target to $400. Article Title Positive Sentiment: Commentary around strong AI data center demand and broader semiconductor momentum is reinforcing the long-term growth narrative for TXN. Article Title Neutral Sentiment: Texas Instruments remains part of a strong semiconductor sector rally, which may provide support, but the stock is also vulnerable to post-earnings “sell the news” behavior after a strong run. Article Title Negative Sentiment: Despite the strong report, shares have slipped as investors question whether the results were already priced in after a big rally and high expectations for chip stocks. Article Title Wall Street Analysts Forecast Growth A number of research analysts have recently issued reports on TXN shares. Rosenblatt Securities boosted their price target on shares of Texas Instruments from $240.00 to $330.00 and gave the stock a “buy” rating in a research note on Thursday, April 23rd. Sanford C. Bernstein lifted their price objective on Texas Instruments from $250.00 to $290.00 and gave the company a “market perform” rating in a report on Thursday. KeyCorp boosted their target price on Texas Instruments from $390.00 to $400.00 and gave the stock an “overweight” rating in a research report on Thursday. Wall Street Zen raised Texas Instruments from a “hold” rating to a “buy” rating in a research note on Saturday, July 18th. Finally, Zacks Research downgraded Texas Instruments from a “strong-buy” rating to a “hold” rating in a research note on Friday, July 10th. Fourteen analysts have rated the stock with a Buy rating, ten have given a Hold rating and four have assigned a Sell rating to the company’s stock. Based on data from MarketBeat.com, the company presently has a consensus rating of “Hold” and a consensus price target of $307.60.

Get Our Latest Report on Texas Instruments

Texas Instruments Trading Down 3.1% Shares of TXN opened at $284.99 on Friday. Texas Instruments Incorporated has a twelve month low of $152.73 and a twelve month high of $334.03. The company has a current ratio of 4.46, a quick ratio of 2.94 and a debt-to-equity ratio of 0.77. The firm has a market capitalization of $259.37 billion, a P/E ratio of 43.38, a PEG ratio of 1.51 and a beta of 1.32. The firm’s 50-day moving average is $301.53 and its two-hundred day moving average is $247.14.

Texas Instruments (NASDAQ:TXN – Get Free Report) last announced its quarterly earnings results on Wednesday, July 22nd. The semiconductor company reported $2.14 EPS for the quarter, topping the consensus estimate of $1.91 by $0.23. Texas Instruments had a return on equity of 36.55% and a net margin of 31.11%.The business had revenue of $5.46 billion for the quarter, compared to analyst estimates of $5.26 billion. During the same quarter in the previous year, the company earned $1.41 EPS. The company’s quarterly revenue was up 22.8% on a year-over-year basis. Texas Instruments has set its Q3 2026 guidance at 2.230-2.570 EPS. On average, research analysts predict that Texas Instruments Incorporated will post 7.69 earnings per share for the current fiscal year.

Texas Instruments Announces Dividend The company also recently announced a quarterly dividend, which will be paid on Tuesday, August 11th. Shareholders of record on Friday, July 31st will be issued a $1.42 dividend. The ex-dividend date of this dividend is Friday, July 31st. This represents a $5.68 annualized dividend and a yield of 2.0%. Texas Instruments’s dividend payout ratio is 97.26%.

Insiders Place Their Bets In related news, CEO Haviv Ilan sold 20,000 shares of the stock in a transaction dated Monday, May 4th. The shares were sold at an average price of $280.32, for a total value of $5,606,400.00. Following the sale, the chief executive officer directly owned 204,339 shares of the company’s stock, valued at approximately $57,280,308.48. This represents a 8.92% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, VP Mark Gary sold 13,689 shares of the company’s stock in a transaction dated Thursday, April 30th. The shares were sold at an average price of $279.25, for a total transaction of $3,822,653.25. Following the completion of the sale, the vice president directly owned 45,547 shares in the company, valued at $12,718,999.75. This trade represents a 23.11% decrease in their position. The SEC filing for this sale provides additional information. Over the last quarter, insiders have sold 199,143 shares of company stock valued at $56,959,010. Company insiders own 0.60% of the company’s stock.

Texas Instruments Profile (Free Report)

Texas Instruments Inc (NASDAQ: TXN) is a global semiconductor company headquartered in Dallas, Texas, that designs and manufactures analog and embedded processing chips. The company’s products are used across a wide range of end markets, including industrial, automotive, personal electronics, communications and enterprise equipment. TI’s business emphasizes components that condition, convert, manage and move electrical signals—capabilities that are foundational to modern electronic systems.

TI’s product portfolio includes a broad array of analog integrated circuits—such as power management, amplifiers, data converters and interface devices—as well as embedded processors and microcontrollers used to control systems and run real-time applications.

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Texas Instruments TXN is experiencing a decline in share price despite surpassing Q2 earnings expectations and providing an optimistic Q3 forecast. The semiconductor company reported a significant year-over-year revenue growth of 22.8%, reaching $5.46 billion, which was well above market predictions. For Q3, TXN anticipates earnings per share (EPS) in the range of $2.23 to $2.57, with revenue projected between $5.65 billion and $6.15 billion, indicating another above-seasonal guidance as demand expands.

Demand Breadth: - Strong performance driven by industrial, data center, and automotive sectors. - Industrial revenue grew approximately 30% year-over-year and about 10% sequentially. - Automotive revenue increased in the mid-teens year-over-year and upper single digits sequentially. - Data center revenue doubled year-over-year and rose around 20% sequentially. Cycle: - TXN perceives customers as being in the early stages of the cycle. - Backlogs have increased for both immediate and longer-term orders, supporting management's outlook for broad, sustained demand growth. Margins & Pricing: - Gross margin expanded by 340 basis points sequentially to 61%, with expectations for further modest growth in Q3. - Pricing remained stable in the first half, contrary to TXN's usual slight declines, with increases starting primarily in Analog. Inventory and Capacity: - TXN's investments in inventory and manufacturing capacity enable quick responses to heightened demand. - The company has sufficient cleanroom infrastructure to support approximately three years of growth and maintains a capital expenditure outlook of $2-3 billion for the year, potentially leaning toward the higher end. Q3 Outlook: - TXN anticipates a stronger and broader demand landscape heading into Q3. - Industrial, data center, and automotive sectors are expected to be the primary growth drivers, with personal electronics also expected to improve. Despite the stock's recent downturn, TXN's Q2 performance was promising, indicating a potential recovery into a broader upcycle. The automotive sector accelerated, and both industrial and data center markets remained robust. The above-seasonal Q3 guidance suggests ongoing strength in core markets. TXN's strategic investments in inventory and manufacturing are yielding benefits, allowing for quick adaptations to increasing customer demands and potential gains from suppliers with longer lead times. The gross margin has improved significantly, and management anticipates further increases in Q3, with pricing expected to contribute more in Q4 and beyond. The stock's decline may reflect high expectations and the possibility that stronger demand could push capital expenditures toward the upper limit of TXN's forecast. It will be crucial for TXN to demonstrate that the overall demand environment continues to foster sustained revenue growth, higher factory utilization, and improved margins as the year progresses into 2027.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

Key Takeaways TXN highlighted broad demand recovery as industrial, automotive and data center markets drove growth.TXN's data center sales doubled year over year, while automotive demand improved with EV and hybrid strength.Texas Instruments is expanding capacity, citing clean room space and investments to support future demand. Texas Instruments Incorporated (TXN - Free Report) emphasized a broad-based demand recovery during its second-quarter fiscal 2026 earnings call, with management highlighting strength across the industrial, data center and automotive markets as key drivers. Revenues exceeded the Zacks Consensus Estimate, while executives focused more on improving demand trends and capacity readiness than on the quarter’s financial results.

Management highlighted expanding opportunities from inventory normalization, stronger customer demand and long-term investments in manufacturing capacity. The discussion also centered on pricing actions, data center growth and the company’s ability to support customers through the current cycle.

TXN Demand Broadens Across Industrial and Automotive MarketsCEO Haviv Ilan said second-quarter revenues reached $5.46 billion, up 23% year over year, with Analog revenues increasing 26% and Embedded Processing revenues rising 16%. Industrial, automotive and data center markets were the primary contributors to growth.

Ilan noted that industrial revenues increased around 30% year over year, automotive revenues grew in the mid-teens and data center revenues doubled from the prior-year period. He added that demand strength expanded beyond the earlier industrial and data center trends.

The company reported earnings per share (EPS) of $2.14, exceeding the Zacks Consensus Estimate of $1.91. Revenues of $5.46 billion also surpassed the Zacks Consensus Estimate of $5.22 billion.

Texas Instruments Sees Strength Across End Markets in Q2Texas Instruments said automotive demand improved during the second quarter of fiscal 2026, with Ilan attributing the improvement to stronger electric vehicle and hybrid demand, particularly in China, along with low customer inventory levels.

Management also discussed data center momentum, where sales doubled year over year. Ilan said higher-voltage architectures and increased power conversion needs could expand opportunities for Analog and Embedded products.

Personal electronics remained comparatively soft, as customer shortages continued to affect the market. Management still expects the segment to contribute to broader third-quarter growth.

Texas Instruments' Capacity Strategy Supports Long-Term GrowthTXN emphasized that its prior investments in inventory and manufacturing capacity are helping it respond to demand. Ilan said the company’s available clean room space positions it to support growth without the constraints experienced in previous cycles.

The company increased factory loadings from the first to the second quarter and said third-quarter decisions will depend on demand conditions. Management identified the Richardson, Sherman and Lehi facilities as key parts of its expansion strategy.

Capital spending remained focused on long-term capacity needs. CFO Rafael Lizardi said 2026 capital expenditures are expected to remain within the $2-$3 billion range, with spending decisions tied to future demand scenarios.

Texas Instruments Pricing Actions Support Future Growth PathTexas Instruments said pricing was stable during the first half of the year, which management described as better than its typical annual pricing trend. Ilan said the company has started implementing price increases for customers.

Management expects pricing benefits to appear gradually, beginning in the third quarter of fiscal 2026 and extending into future periods, depending on customer discussions and annual pricing cycles.

Analysts also questioned whether the strength in the industrial market was driven by pricing or product value. Management said the second-quarter improvement was primarily driven by secular content growth, inventory normalization and new system demand.

TXN Outlook Reflects Broad-Based Growth Across Key MarketsTXN guided third-quarter revenues to a range of $5.65-$6.15 billion and EPS to $2.23-$2.57. Management expects strength across the industrial, data center, automotive and personal electronics markets.

A JPMorgan analyst asked about automotive momentum and pricing actions. Ilan said demand improved during the second quarter and reflected broader customer needs rather than a single market factor.

A Goldman Sachs analyst asked about inventory and factory utilization. Management said inventory declined sequentially and that available capacity gives TXN the flexibility to respond as demand evolves.

Texas Instruments Closing ViewTexas Instruments maintained that its long-term value creation remains tied to manufacturing strength, technology investments, product breadth and disciplined capital allocation. Management reiterated that free cash flow per share growth remains its key performance objective.

The company reported trailing 12-month free cash flow of $6.5 billion and returned $5.8 billion to shareholders during the same period. Management continued to emphasize balancing capacity investment with shareholder returns.

Texas Instruments Zacks RankTXN carries a Zacks Rank #2 (Buy). The Zacks Rank focuses on earnings estimate revisions and is designed to help identify stocks with stronger potential performance over the next one to three months. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The stock has a Value Score of D, Growth Score of B, Momentum Score of B and VGM Score of C. Zacks Style Scores evaluate value, growth and momentum characteristics, with higher scores indicating stronger attributes within each style category.
The Zacks Rank can change as analysts update earnings estimates following new company information, including developments after the latest quarterly results.