In the latest trading session, Texas Instruments (TXN) closed at $161.98, marking a -0.45% move from the previous day. This change lagged the S&P 500's 0.06% loss on the day. Meanwhile, the Dow gained 0.29%, and the Nasdaq, a tech-heavy index, added 0.23%.
Coming into today, shares of the chipmaker had gained 7.03% in the past month. In that same time, the Computer and Technology sector gained 12.9%, while the S&P 500 gained 11.09%.
TXN will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.32, up 17.86% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.58 billion, up 6.88% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $5.47 per share and revenue of $13.96 billion. These totals would mark changes of +4.39% and -2.92%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for TXN. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.05% higher. TXN is currently a Zacks Rank #2 (Buy).
Looking at its valuation, TXN is holding a Forward P/E ratio of 29.76. For comparison, its industry has an average Forward P/E of 27.73, which means TXN is trading at a premium to the group.
Investors should also note that TXN has a PEG ratio of 3.19 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Semiconductor - General industry currently had an average PEG ratio of 3.13 as of yesterday's close.
The Semiconductor - General industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 126, putting it in the top 50% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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