Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Texas Instruments Stock Falls on Soft Guidance, Analysts Blame Restrictions in China

Stock Markets Apr 27, 2022 09:01AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Texas Instruments (TXN) Stock Falls on Soft Guidance, Analysts Blame Restrictions in China

Texas Instruments (NASDAQ:TXN) issued a weaker-than-expected Q2 forecast, sending its shares tumbling more than 3% in premarket trading Wednesday.

The company reported Q1 revenue of $4.91 billion, up 14% YoY and above the analyst consensus of $4.72 billion. Strong sales were fueled by “growth in industrial and automotive.”

TXN reported Q2 EPS of $2.35, up from $1.87 in the year-ago period. The EPS print took into account a 2-cent benefit for items that were not included in the initial guidance.

Analog revenue stood at $3.82 billion, up 16% YoY, topping the consensus estimates of $3.67 billion. Embedded processing revenue came in at $782 million, up 2% YoY and compared to the estimated $769 million.

For Q2, the semiconductor maker expects revenue in the range of $4.2 billion to $4.8 billion, missing the consensus estimates of $4.96 billion.

TXN expects EPS in the range of $1.84 to $2.26, short of the estimated $2.28 per share.

“This outlook comprehends an impact due to reduced demand from COVID-19 restrictions in China,” the company said in a press release.

Barclays analyst Blayne Curtis lowered the price target to $150.00 per share from $170.00 and said TXN’s results should be seen as “merely the beginning of a broader cyclical correction.”

“The lower June guidance was a surprise, but we do expect increased shortages and shutdowns to be a bigger trend through earnings… We do see a substantial cycle coming and this reset as only the beginning of a larger correction. TXN history tells us that every DD growth year is usually followed by decline the year after, and after 27% growth in 2021, we view a sizable correction as needed. We do recognize that analog names are typically safer in a market correction but we still don’t believe the stock has corrected enough to become interesting,” Curtis said on the Underweight-rated TXN stock.

BofA analyst Vivek Arya lowered the price target to $190.00 per share from the prior $200.00 and is more bullish on TXN than his Barclays (LON:BARC) colleague.

“We reiterate Buy on a strong track record of consistent share gains, free cash flow generation and returns, and profitability resilience even in a downcycle,” Curtis said in a note.

By Senad Karaahmetovic

Texas Instruments Stock Falls on Soft Guidance, Analysts Blame Restrictions in China
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email