Texas Instruments (TXN) Stock Declines Amid Market Gains: Key Information to Consider

Texas Instruments (TXN) finished the latest trading day at $177.99, reflecting a decrease of -0.95% compared to its previous closing price. This performance was overshadowed by gains in the broader market; the S&P 500 saw a daily increase of 0.38%, while the Dow experienced a slight decline of 0.03% and the technology-focused Nasdaq index gained 0.87%.

Over the past month, shares of Texas Instruments have declined by 7.56%. This drop is notably more pronounced than the loss in the Computer and Technology sector, which fell by 8.94%, and the broader S&P 500, which decreased by 5.59% during the same period.

Investors are eagerly awaiting the upcoming earnings report for Texas Instruments. Analysts expect the company to report earnings of $1.06 per share, indicating a year-over-year decrease of 11.67%. Additionally, revenue is anticipated to reach $3.91 billion, which would mark a growth of 6.74% compared to the same quarter last year.

Looking at the full year, Zacks Consensus Estimates suggest that Texas Instruments will achieve earnings of $5.35 per share and revenue of $17.05 billion, reflecting increases of 2.88% and 9%, respectively, from the previous year.

It is also vital for investors to keep an eye on the revisions to analyst estimates for Texas Instruments. These changes can indicate shifts in business trends and analyst sentiment about the company’s profitability. Generally, positive estimate adjustments signify a more favorable outlook from analysts.

Research shows that these estimate changes can be closely linked to stock price movements. Investors can leverage this information through the Zacks Rank system, which takes these estimate changes into account to offer a straightforward and actionable rating. The ranks range from #1 (Strong Buy) to #5 (Strong Sell), and historically, #1 stocks have averaged a return of +25% annually since 1988. Currently, Texas Instruments holds a Zacks Rank of #4, indicating a Sell recommendation.

In terms of valuation, Texas Instruments is trading at a Forward P/E ratio of 33.6, which is higher than the industry average Forward P/E of 25.91. Furthermore, TXN has a PEG ratio of 2.91. This ratio, similar to the P/E ratio, also accounts for expected earnings growth. At this moment, the average PEG ratio within the Semiconductor - General industry stands at 1.88.

The Semiconductor - General industry is classified under the Computer and Technology sector, boasting a Zacks Industry Rank of 80, positioning it within the top 33% of over 250 industries. The Zacks Industry Rank evaluates the strength of industry groups by averaging the Zacks Rank of the individual stocks within them. Historically, industries rated in the top 50% tend to outperform those in the bottom half by a factor of two to one.

To stay updated on stock-moving metrics and other relevant data in the upcoming trading sessions, be sure to monitor these metrics closely.

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