Texas Instruments Inc

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TXN : NASDAQ : Technology
$68.98 | %
Today's Range: 68.98 - 70.00
Avg. Daily Volume: 5,385,500
09/23/16 - 4:00 PM ET

Financial Analysis


TEXAS INSTRUMENTS INC's gross profit margin for the second quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company has grown its sales and net income during the past quarter when compared with the same quarter a year ago, and although its growth in net income has outpaced the industry average, its revenue growth has not. TEXAS INSTRUMENTS INC has strong liquidity. Currently, the Quick Ratio is 1.95 which shows the ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

During the same period, stockholders' equity ("net worth") has remained virtually unchanged only decreasing by 2.38% from the same quarter last year. The key liquidity measurements indicate that the company is unlikely to face financial difficulties in the near future.

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Income Statement Q2 FY16 Q2 FY15
Net Sales ($mil)3273.03232.0
EBITDA ($mil)1361.01302.0
EBIT ($mil)1119.01011.0
Net Income ($mil)779.0696.0


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)2539.03306.0
Total Assets ($mil)15693.017532.0
Total Debt ($mil)3612.04884.0
Equity ($mil)9962.010205.0


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin66.1864.73
EBITDA Margin41.5840.28
Operating Margin34.1931.28
Sales Turnover0.820.75
Return on Assets19.6317.12
Return on Equity30.9229.42
Debt Q2 FY16 Q2 FY15
Current Ratio3.362.52
Debt/Capital0.270.32
Interest Expense21.024.0
Interest Coverage53.2942.13


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)1003.351034.1
Div / share0.380.34
EPS0.760.65
Book value / share9.939.87
Institutional Own % n/a n/a
Avg Daily Volume5429048.04953996.0

Valuation


BUY. TEXAS INSTRUMENTS INC's P/E ratio indicates a discount compared to an average of 27.99 for the Semiconductors & Semiconductor Equipment industry and a value on par with the S&P 500 average of 25.19. For additional comparison, its price-to-book ratio of 7.03 indicates a significant premium versus the S&P 500 average of 2.82 and a significant premium versus the industry average of 4.16. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
TXN 23.49 Peers 27.99   TXN 15.68 Peers 16.13

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

TXN is trading at a discount to its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

TXN is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
TXN 20.86 Peers 18.94   TXN 2.76 Peers 2.65

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

TXN is trading at a premium to its peers.

 

Average. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

TXN trades at a valuation on par to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
TXN 7.03 Peers 4.16   TXN 6.83 Peers -0.00

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

TXN is trading at a significant premium to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

TXN is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
TXN 5.43 Peers 4.64   TXN -1.93 Peers 4.90

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

TXN is trading at a premium to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

TXN significantly trails its peers on the basis of sales growth

 

 

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