Nomura Stays “Neutral” on Texas Instruments Ahead of Earnings (TXN)

Microchip maker Texas Instruments, Inc. (TXN) on Thursday caught some tepid commentary from analysts at Nomura Securities.

The firm backed its “Neutral” rating and $32 price target on TXN, which suggests a 12% upside to the stock’s Wednesday closing price of $28.54.

However, a Nomura analyst commented, “Earlier this week, we hosted a conference call with TI’s Brian Glinsman, Vice President of Communications Infrastructure…Mr. Glinsman was very balanced on the opportunity of SoC versus PLDs, even though TI is seeing good momentum with its newly available SoCs. The SoC devices are more integrated, provide packet-level processing, and are much cheaper. PLDs, though, are not going away. Mr. Glinsman believes PLD content is extremely high in 4G base-stations though declining as units ramp.”

Continuing, “While we recognize that TI’s stock has underperformed and FCF yield is attractive (8-10%), we believe Q3 is shaping up to be below consensus revenue growth of 7%.”

Texas Instruments shares were unchanged in premarket trading Thursday.

The Bottom Line
Shares of Texas Instruments (TXN) have a 2.38% dividend yield, based on last night’s closing stock price of $28.54. The stock has technical support in the $25-$27 price area. If the shares can firm up, we see overhead resistance around the $30-$31 price levels.

Texas Instruments, Inc. (TXN) is not recommended at this time, holding a DARS™ Rating of 3.2 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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