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Texas Instruments

(TXN) - Get Texas Instruments Incorporated Report

came in a penny ahead of Wall Street's profit view for its fourth-quarter results Monday but shares dipped in after-hours action as the chip maker's outlook offered some downside to current analyst expectations.

The stock was last quoted at $33.70, down 2.7%, on volume of around 535,000, according to

. The shares rose more than 2% during Monday's regular session as

tech stocks got a lift

from news of


(INTC) - Get Intel Corporation Report

plans to lift its dividend and expand its buyback program.

Texas Instruments reported earnings of $942 million, or 78 cents a share, for the three months ended Dec. 31. Those results included a gain of 14 cents a share related to an asset sale and a tax benefit. Backing out the gain, the company earned 64 cents a share in the latest quarter, edging the average analysts' view.

Revenue came in at $3.53 billion for the December period, up 17% from the year-ago equivalent total of $3.01 billion, and incrementally ahead of the consensus estimate.

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On Dec. 7, the company

tightened its outlook for the fourth quarter

, forecasting earnings of 61 to 65 cents a share on revenue of $3.43 billion to $3.57 billion.

"Our strong financial results for the fourth quarter reinforce our view that the inventory-driven downturn that started in the second half of 2010 is now mostly complete," said Rich Templeton, the company's chairman, president and CEO, in a statement. "We used this short and shallow downturn to replenish our inventory, return product lead times to normal and ramp three new factories."

Orders stood at $3.13 billion at quarter's end, down 4% from last year and off 9% on a sequential basis. It was the second straight sequential decline in orders for Texas Instruments following a 10% drop in its fiscal third quarter. Templeton, however, was bullish about the company's progress in its analog, embedded processor businesses as well as demand for wireless chips used smartphones and tablets.

"As we enter 2011, Analog and Embedded Processing technologies are becoming even more pervasive in the electronics of everyday life," he said. "They are critical for the small form factors and long battery lives in tablets and smartphones, the safety and intelligence features in automobiles, and the reliability and energy-saving features of the smart grid. With our focused R&D and expanded manufacturing capacity, we're ready to deliver when and where our customers want."

For the current fiscal 2011 first quarter, ending in March, Texas Instruments projects earnings of 54 to 62 cents a share on revenue ranging from $3.27 billion to $3.55 billion. The current average estimate of analysts polled by

Thomson Reuters

is for earnings of 57 cents a share in the March quarter on revenue of $3.32 billion.

Based on a regular session close at $34.65, the shares had risen more than 4% so far in 2011 with 2% of that coming on Monday ahead of the quarterly report. In the past 52 weeks, the stock is up more than 40% with its 52-week high of $34.86 coming last week.

The analyst community was split on where the shares head from here before getting a look at the fourth-quarter numbers. Of the 40 analysts covering the stock, a near majority were at hold (18) and there were five outwardly bearish analysts at underperform (4) and sell (1) vs. 17 bulls at either strong buy (9) or buy (8).

The median 12-month price target of $33 suggests though that the valuation has gotten a bit rich. On a forward price-to-earnings basis, based on Wall Street's fiscal 2011 profit view, Texas Instruments' stock trades at a 13.6X multiple vs. just below 17X for


(QCOM) - Get Qualcomm Inc Report

and 9.7X for Intel.


Written by Michael Baron in New York.

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Michael Baron


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