Texas Instruments Inc (TXN, Financial) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $164.55, Texas Instruments Inc has witnessed a daily gain of 0.28%, marked against a three-month change of 7.79%. A thorough analysis, underlined by the GF Score, suggests that Texas Instruments Inc is well-positioned for substantial growth in the near future.
What Is the GF Score?
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 7/10
- Profitability rank: 9/10
- Growth rank: 9/10
- GF Value rank: 5/10
- Momentum rank: 8/10
Considering these components, GuruFocus assigned Texas Instruments Inc a GF Score of 92 out of 100, which signals the highest outperformance potential.
Understanding Texas Instruments Inc Business
Texas Instruments Inc, with a market cap of $149.62 billion and sales of $17.52 billion, is a Dallas-based company that generates over 95% of its revenue from semiconductors, with the remainder from its well-known calculators. As the world's largest maker of analog chips, which are used to process real-world signals such as sound and power, Texas Instruments Inc also holds a leading market share in processors and microcontrollers used in a wide variety of electronics applications. The company's operating margin stands at a robust 41.85%, reflecting its operational efficiency and profitability.
Financial Strength Breakdown
According to the Financial Strength rating, Texas Instruments Inc's robust balance sheet exhibits resilience against financial volatility, reflecting prudent management of capital structure. The Interest Coverage ratio for Texas Instruments Inc stands impressively at 20.77, underscoring its strong capability to cover its interest obligations. With an Altman Z-Score of 9.83, Texas Instruments Inc exhibits a strong defense against financial distress, highlighting its robust financial stability. The favorable Debt-to-Revenue ratio of 0.64 further solidifies its financial health.
Profitability Rank Breakdown
The Profitability Rank of Texas Instruments Inc is a testament to its impressive standing among peers in generating profit. The company's strong Predictability Rank of 4.5 stars out of five underscores its consistent operational performance, providing investors with increased confidence in its financial returns.
Growth Rank Breakdown
Ranked highly in Growth, Texas Instruments Inc demonstrates a strong commitment to expanding its business. The company's 3-Year Revenue Growth Rate is 7.3%, which outperforms 61.07% of companies in the Semiconductors industry. Moreover, Texas Instruments Inc has seen a robust increase in its EBITDA over the past few years, with a three-year growth rate of 8.4 and a five-year rate of 8.9, highlighting its capability to drive growth.
Next Steps
Considering Texas Instruments Inc's financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential outperformance. Investors seeking to capitalize on such robust financials and strategic market positioning would do well to consider the insights provided by the GF Score. For those looking to explore further, GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
