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Texas Instruments Plans to Add New Facility for Expansion
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Texas Instruments (TXN - Free Report) plans to consider North Richardson manufacturing facility to increase its manufacturing capacity, in an attempt to leverage benefits from the growing demand for the company’s products.
Reportedly, Texas Instruments plans to invest $3.2 billion in the project and bring an estimated 650 new jobs to Richardson by 2030.The construction on the property in expected to begin in 2019, with commercial operations slated to begin in the first quarter of 2022.
Notably, the stock has underperformed the industry in the past 12 months. It has gained 38.7% compared with the industry’s growth of 41.3%.
Business Strengthening Through Capacity Expansion
Capacity expansion has been a priority for Texas Instruments over time. Its capital allocation policy primarily includes acquisitions of meaningful businesses, returning capital to its shareholders and investing in research and development activities, as well as in equipment and manufacturing facilities.
Out of the $3.2 billion to be invested in the Richardson manufacturing facilityproject, Texas Instruments plans to use $500 million for new buildings or other non-removable improvements to the property, and the remaining $2.7 billion for items such as computers, machinery or other movable goods.
Reportedly, the company already has 15 manufacturing sites in nine countries. Also, the deal is expected to save the company from paying $100 million in property taxes over the span of a decade.
Bright Growth Prospects
Constant innovation of products, differentiation in business and manufacturing efficiencies that include growing 300-millimeter Analog output, increasing exposure in growth markets, especially industrial and automotive markets, are increasingly proving to be advantageous for the company. We believe that Texas Instruments is uniquely positioned to leverage benefits from such favorable market trends. In addition, the company is working toward expanding its geographical footprint, adding new customers, focusing on developing new manufacturing processes and offering improvised products.
For the third quarter, Texas Instruments anticipates revenues between $4.11 billion and $4.45 billion (up 7% sequentially at the midpoint of the guided range). Earnings for the quarter are expected in the range of $1.41-$1.63 per share. The guidance includes an estimated $10 million discrete tax benefit.
In the past 60 days, 11 estimates for 2018 and 10 estimates for 2019 have been revised upward. The Zacks Consensus Estimate is now pegged at $5.66 for 2018 and $6.12 for 2019, reflecting growth of 32.2% and 8.2% from 60 days ago respective tallies.
Texas Instruments Incorporated Price and Consensus
Long-term earnings growth for Cirrus Logic, Infineon Technologies and Rambus is currently projected to be 15%, 7.5% and 10%, respectively.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
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Texas Instruments Plans to Add New Facility for Expansion
Texas Instruments (TXN - Free Report) plans to consider North Richardson manufacturing facility to increase its manufacturing capacity, in an attempt to leverage benefits from the growing demand for the company’s products.
Reportedly, Texas Instruments plans to invest $3.2 billion in the project and bring an estimated 650 new jobs to Richardson by 2030.The construction on the property in expected to begin in 2019, with commercial operations slated to begin in the first quarter of 2022.
Notably, the stock has underperformed the industry in the past 12 months. It has gained 38.7% compared with the industry’s growth of 41.3%.
Business Strengthening Through Capacity Expansion
Capacity expansion has been a priority for Texas Instruments over time. Its capital allocation policy primarily includes acquisitions of meaningful businesses, returning capital to its shareholders and investing in research and development activities, as well as in equipment and manufacturing facilities.
Out of the $3.2 billion to be invested in the Richardson manufacturing facilityproject, Texas Instruments plans to use $500 million for new buildings or other non-removable improvements to the property, and the remaining $2.7 billion for items such as computers, machinery or other movable goods.
Reportedly, the company already has 15 manufacturing sites in nine countries. Also, the deal is expected to save the company from paying $100 million in property taxes over the span of a decade.
Bright Growth Prospects
Constant innovation of products, differentiation in business and manufacturing efficiencies that include growing 300-millimeter Analog output, increasing exposure in growth markets, especially industrial and automotive markets, are increasingly proving to be advantageous for the company. We believe that Texas Instruments is uniquely positioned to leverage benefits from such favorable market trends. In addition, the company is working toward expanding its geographical footprint, adding new customers, focusing on developing new manufacturing processes and offering improvised products.
For the third quarter, Texas Instruments anticipates revenues between $4.11 billion and $4.45 billion (up 7% sequentially at the midpoint of the guided range). Earnings for the quarter are expected in the range of $1.41-$1.63 per share. The guidance includes an estimated $10 million discrete tax benefit.
In the past 60 days, 11 estimates for 2018 and 10 estimates for 2019 have been revised upward. The Zacks Consensus Estimate is now pegged at $5.66 for 2018 and $6.12 for 2019, reflecting growth of 32.2% and 8.2% from 60 days ago respective tallies.
Texas Instruments Incorporated Price and Consensus
Texas Instruments Incorporated Price and Consensus | Texas Instruments Incorporated Quote
Zacks Rank & Other Stocks to Consider
Currently, Texas Instruments has a Zacks Rank #2 (Buy). Other top-ranked stocks in the technology sector are Cirrus Logic, Inc. (CRUS - Free Report) , Infineon Technologies AG (IFNNY - Free Report) and Rambus Inc. (RMBS - Free Report) , each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Long-term earnings growth for Cirrus Logic, Infineon Technologies and Rambus is currently projected to be 15%, 7.5% and 10%, respectively.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>