No shock, shareholders of Texas Instruments (TXN) are having a rough year, dragged down by a slowdown in the semiconductor industry as a whole. As I write, shares of the $31 billion firm have slid more than 7% since the first trading day of January. But TXN owners could get some reprieve from a boosted dividend -- and investors looking for a lower cost yield have one.
TXN may be best known for its ubiquitous calculators, but the firm's biggest business comes from its position as the world's largest analog chipmaker. Analog chips are used to process analog signals (voices, for instance) and turn them digital. As a result, TXN has a big role supplying components to the fast-paced mobile phone market. The firm has been entrenching itself in the chip business, spending money on next generation manufacturing equipment and acquiring National Semiconductor last year in a deal that dramatically boosted TXN's positioning in the analog chip market.While that acquisition added some debt to Texas Instruments' formerly debt-free balance sheet, it's a modest obligation compared to the amount of cash that the firm is able to generate. I'd anticipate a hike to TXN's 17-cent dividend later on in 2012.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV