Texas Instruments Faces Market Challenges Despite Strong Earnings Report
Company Overview and Market Performance
Valued at $164.7 billion by market cap, Texas Instruments Incorporated (TXN) designs, manufactures, tests, and sells analog and embedded processing chips. The company’s extensive portfolio features over 80,000 products, catering to more than 100,000 customers across diverse industries like industrials, automotive, personal electronics, communications equipment, and enterprise systems.
Stock Performance Compared to Market Trends
The Dallas-based semiconductor designer has struggled compared to the wider market in the past year. TXN stock gained only 14.3% over the last 52 weeks, with a 3.2% decline year-to-date (YTD). This contrasts sharply with the S&P 500 Index’s ($SPX) 22.6% increase over the same period and its 3.1% gain in 2025.
Focusing on a narrower timeframe, TXN outperformed the iShares Semiconductor ETF’s (SOXX) 9.5% rise over the past year. However, it trailed behind SOXX’s 2.4% rise in 2025.
Recent Earnings and Investor Reactions
On January 23, Texas Instruments released its Q4 2024 results, beating analysts’ expectations for both revenue and earnings. However, the stock price fell 7.5% in response. Revenues of $4 billion were down 1.7% year-over-year but exceeded expectations by 3.9%. Earnings of $1.30 per share also surpassed analyst forecasts by 9.2%. Despite this positive news, the company’s guidance for Q1 2025 revenue, which ranges from $3.74 billion to $4.06 billion, along with earnings per share (EPS) guidance between $0.94 and $1.16, failed to meet market expectations, unsettling investors.
Outlook for 2025 and Analyst Consensus
Looking ahead to fiscal 2025, which concludes in December, analysts predict a 4.2% increase in earnings year-over-year, anticipating earnings of $5.42 per share. Texas Instruments has a history of beating earnings expectations, achieving this feat in each of the last four quarters.
Among the 30 analysts monitoring TXN stock, the consensus rating is a “Moderate Buy,” with 10 “Strong Buy,” 16 “Hold,” 1 “Moderate Sell,” and 3 “Strong Sell” ratings. This outlook has remained relatively stable over the last three months.
Analyst Target Adjustments
On January 24, Truist analyst William Stein adjusted TXN’s price target to $195 while keeping a “Hold” rating. The mean price target for TXN is $208.57, suggesting a 14.9% premium compared to current price levels. The highest target on the street stands at $284, indicating a potential upside of 56.4%.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.
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