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Texas Instruments (TXN) Stock Declines While Market Improves: Some Information for Investors

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In the latest trading session, Texas Instruments (TXN - Free Report) closed at $180.12, marking a -1.36% move from the previous day. This change lagged the S&P 500's daily gain of 0.11%. Meanwhile, the Dow experienced a drop of 0.07%, and the technology-dominated Nasdaq saw an increase of 0.22%.

Coming into today, shares of the chipmaker had gained 11.63% in the past month. In that same time, the Computer and Technology sector lost 1.07%, while the S&P 500 gained 0.08%.

The upcoming earnings release of Texas Instruments will be of great interest to investors. The company is expected to report EPS of $1.28, down 1.54% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $4.42 billion, up 10.38% from the prior-year quarter.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $5.46 per share and revenue of $17.69 billion. These totals would mark changes of +5% and +13.07%, respectively, from last year.

Investors should also pay attention to any latest changes in analyst estimates for Texas Instruments. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, there's been a 0.79% fall in the Zacks Consensus EPS estimate. Texas Instruments currently has a Zacks Rank of #3 (Hold).

Looking at its valuation, Texas Instruments is holding a Forward P/E ratio of 33.44. Its industry sports an average Forward P/E of 41.67, so one might conclude that Texas Instruments is trading at a discount comparatively.

Investors should also note that TXN has a PEG ratio of 3.24 right now. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. Semiconductor - General stocks are, on average, holding a PEG ratio of 4.53 based on yesterday's closing prices.

The Semiconductor - General industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 35, positioning it in the top 15% of all 250+ industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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