Texas Instruments Inc (TXN) Stock Analysis
Verdict: WATCH (do not buy)
CapEx easing and 300mm fab efficiency drive a cyclical FCF surge, but a 42.2x P/E and insider selling limit near-term risk-reward.
Investment score: 58/100
Analysis as of
Is Texas Instruments Inc stock worth reviewing? AI model thesis
Texas Instruments is emerging from an industrial downturn with broad revenue acceleration (+23% YoY in Q2 2026) and surging cash generation as its heavy 300mm fab CapEx cycle passes its peak. While structural cost advantages and AI data center power demand bolster long-term earnings toward $10.33 EPS in FY2027, an elevated P/E ratio of 42.23x and consistent insider distribution suggest waiting for a better valuation entry point.
7-factor investment score
- Valuation: 48/100 (weight 20%)
- Financial Health: 78/100 (weight 15%)
- Technical Momentum: 62/100 (weight 15%)
- Earnings Quality: 68/100 (weight 15%)
- Insider Sentiment: 32/100 (weight 10%)
- Analyst Consensus: 58/100 (weight 10%)
- Risk-Adjusted Return: 58/100 (weight 15%)
Texas Instruments Inc opportunities and risks
What speaks for TXN
- CapEx peak inflection expanding Free Cash Flow and shareholder returns
What speaks against TXN
- Premium trailing valuation (P/E 42.23x) leaves zero room for execution missteps
Peers and competitors
| Ticker | P/E | P/S | EV/EBITDA | Gross margin | Net margin | FCF yield |
|---|---|---|---|---|---|---|
| TXN | 42.2x | 13.1x | 27.4x | 58.3% | 31.1% | 2.1% |
| NVDA | 27.3x | 17.3x | 22.5x | 74.7% | 63.7% | 2.4% |
| AVGO | 42.7x | 18.4x | 32.1x | 68.8% | 42.9% | 2.4% |
| MU | 12.4x | 7.9x | 9.3x | 80.7% | 63.8% | 5.0% |
| AMD | 142.7x | 22.2x | 85.6x | 53.2% | 15.6% | 0.9% |
| INTC | n/a | 8.8x | 147.5x | 38.9% | -19.8% | 0.6% |
| Peer median | 27.3x | 17.3x | 32.1x | 68.8% | 42.9% | 2.4% |
Frequently asked questions about Texas Instruments Inc (TXN)
Is TXN stock a good investment?
The cached TradeMates AI model rates Texas Instruments Inc as WATCH (do not buy) with an investment score of 58/100. Texas Instruments is emerging from an industrial downturn with broad revenue acceleration (+23% YoY in Q2 2026) and surging cash generation as its heavy 300mm fab CapEx cycle passes its peak. While structural cost advantages and AI data center power demand bolster long-term earnings toward $10.33 EPS in FY2027, an elevated P/E ratio of 42.23x and consistent insider distribution suggest waiting for a better valuation entry point. This is algorithmic model output, not personal investment advice.
Is TXN stock a buy?
The TradeMates model verdict for TXN is WATCH (do not buy) with an investment score of 58/100. Treat this as a model signal to review, not a personal buy recommendation.