What Has Driven Texas Instruments Stock Higher In Recent Years?
Texas Instruments Incorporated (NASDAQ: TXN) stock price rose about 38% from $128 at 2019 end to around $176 currently, primarily due to favorable changes in its revenues. During this period, the company, a designer and manufacturer of semiconductors and various integrated circuits, witnessed a strong 36% rise in revenues, and combined with a 2.7% drop in its outstanding share count, revenue per share jumped 39%. Additionally, over the same period, the S&P 500 returned around 36%, meaning that TXN stock managed to marginally outperform the index since late 2019.
In our interactive dashboard, Why Texas Instruments Stock Moved: TXN Stock Has Gained 38% Since 2019, we break down the factors behind this move.
(A) Texas Instruments’ Total Revenue has grown 36% from $14.4 billion in FY 2019 to $19.5 billion on an LTM basis
- TI’s total revenue grew from $14.4 billion in FY ’19 to $20 billion in FY’22.
- However, over the last 12 months, they have declined a bit to about $19.5 billion.
- TI’s largest segment is the analog semiconductor segment, which brought in $15.4 billion in FY ’22, making up about 77% of the company’s total sales.
- For additional details about TI’s revenues and comparison to peers, see Texas Instruments (TXN) Revenue Comparison
- Texas Instruments Stock Is Up 25% This Year, But Looks Like The Chips Are Down Now
- With Analog Market Seeing A Lull, What To Expect From Texas Instruments Q2 Earnings?
- With Analog Semiconductor Market Looking Up, Is Texas Instruments Stock Attractive At $182?
- How Will New iPads And Higher iPhone Pricing Help Apple Suppliers?
- With New iPhones Around The Corner, Are Apple Supplier Stocks A Buy?
- What’s The Outlook Like For Apple Vendors’ Stocks?
(B) Revenue per share (RPS) increased 39% from $15.42 in 2019 to $21.49 currently
- TXN Revenue has increased from $14 Bil in 2019 to $20 Bil in the last 12 months, implying a 36% change. The company’s shares outstanding have decreased from 933 million at the end of 2019 to 908 million currently, implying a 2.7% change
- Due to this, RPS has jumped from $15.42 in 2019 to $21.49 currently.
(C) Price-To-Sales (P/S) multiple for Texas Instruments rose strongly from 8.3x in 2019 to 10.5x in 2020 although it has declined to about 8.2x presently.
- TI’s P/S multiple rose strongly to 10.5x by late 2020, on the back of rising investor expectations surrounding a revival in sales growth amidst rising demand for the company’s products.
- However, due to current geopolitical tensions and the increased economic uncertainty weighing on the broader markets, the P/S multiple has pulled back, currently standing at around 8.2x.
- For additional details about the company stock returns and comparison to peers, see Texas Instruments (TXN) Stock Return Comparison.
What if you’re looking for a more balanced portfolio instead? Here’s a high-quality portfolio that’s beaten the market consistently since 2016.
| Returns | Jun 2023 MTD [1] |
2023 YTD [1] |
2017-23 Total [2] |
| TXN Return | 2% | 7% | 142% |
| S&P 500 Return | 5% | 15% | 97% |
| Trefis Multi-Strategy Portfolio | 7% | 17% | 267% |
[1] Month-to-date and year-to-date as of 6/20/2023
[2] Cumulative total returns since the end of 2016
Invest with Trefis Market Beating Portfolios
See all Trefis Price Estimates