TLDR
- Texas Instruments (TXN) stock slipped 0.5% to about $283 after hours, following a 2% gain in the regular session.
- Q3 earnings per share were $2.62 on revenue of $6.06 billion, up 28% from a year ago. Both topped estimates.
- Q4 revenue guidance of $5.8 billion to $6.3 billion and EPS guidance of $2.45 to $2.79 beat forecasts.
- The stock is 14% below its June high and trades near 28 times projected earnings.
- Wells Fargo trimmed its price target to $300, and Lam Research fell 5% after its own report.
Texas Instruments (TXN) stock slipped 0.5% to about $283 in after-hours trading Wednesday. The dip followed a third-quarter report that topped Wall Street estimates.
Texas Instruments Incorporated, TXN
The stock had closed the regular session up 2.47%. That run may have taken some of the shine off the news.
Earnings per share came in at $2.62, up from $1.48 a year ago. Analysts had expected about $2.44.
Revenue rose 28% from a year earlier to $6.06 billion. The Street was looking for roughly $5.93 billion.
CEO Haviv Ilan said revenue grew 11% from the prior quarter. He pointed to growth in industrial, automotive and data center markets.
Fourth-Quarter Outlook Beats Forecasts
Texas Instruments guided fourth-quarter revenue to $5.8 billion to $6.3 billion. Analysts had penciled in about $5.76 billion.
Earnings per share guidance is $2.45 to $2.79. The consensus sat near $2.31.
Investors had feared the outlook would look light for a stock priced above its peers. This guide put much of that worry to rest.
M Science analyst Chandler Willison said it was “not a blowout quarter.” He added that the report showed “competent, continued execution.”
Cantor Fitzgerald had warned that expectations for TXN were among the most aggressive in the analog group. So the bar was high going in.
Valuation and Analyst Moves
The stock is down 14% from its all-time high in June. It had climbed about 94% in the first half of the year.
In June it traded at 40 times projected 12-month earnings, its richest level in over a decade. It now sits near 28 times.
Wells Fargo cut its price target to $300 from $310 on October 20. The firm kept its Equal Weight rating.
Cantor Fitzgerald holds a Neutral rating with a $340 target. Insiders made 33 sales and no open-market buys over the past six months.
Lam Research fell 5.1% after its own report. It posted a modest beat, but its guidance was only in line with expectations.
The S&P 500 rose 0.58% on Wednesday. The Dow gained 0.69% and the Nasdaq added 1.05%.
TXN sits well below its 52-week high of $334.03 and far above its 52-week low of $152.73. After hours, it traded near $283.
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