TEXAS INSTRUMENTS INC

TXN

Forward P/E: 25.25×
Mkt cap: 231 B USD
EV: 242 B USD
Sector: Technology
Coverage: 2007–2025
Currency: USD
Next event: Feb 6, 2027

JP Valuation

JP Score

28,5

Out of profile · window 5 years

JP entry price

OUT OF PROFILE

No target price is issued: the company falls outside the profile this method looks for.

Financial comments5

The share count grows: net dilution.
Stagnation: 3-year earnings CAGR at or below zero. It is scored, not cut: the penalty is charged by the Impairment modifier, where it is continuous and capped.
High stock-based compensation relative to FCF.
Median payout of 192 % of FCF: the dividend yield only counts half in the shareholder-returns modifier.
Impairment of fcf: 23 % of the window, weighted by recency → 2.8 points. It is the only place in the model where a bad year subtracts.

Quality factors

Each factor scores 0–100 on its own scale; the score is their weighted average.

Score	Weight → points
Growth consistency9 Earnings · fit to the log-linear line · σ_resid = 0.10622 %0 Earnings · hit rate · 50 %16 %3 Earnings · volatility · σ = 0.18811 %33 Revenue · fit to the log-linear line · σ_resid = 0.06714 %0 Revenue · hit rate · 50 %11 %3 Revenue · volatility · σ = 0.1177 %75 Forward · trajectory coherence · consensus 35.7 % vs. trend -13.9 %20 %0	·20 → 1,90
Growth pace49 Realized · -10.4 %50 %0 Expected · 35.7 %50 %98	·20 → 9,75
No recent stagnation50 Realized slowdown · 1.61×50 %1 Expected slowdown · -3.42×50 %99 3-year earnings CAGR at or below zero (-16.9 %): the engine has slowed. It is scored on the acceleration scale, not cut — a binary cut turned a continuous fact into a cliff, and fired on 36 % of the universe. Stagnation: 3-year earnings CAGR at or below zero. It is scored, not cut: the penalty is charged by the Impairment modifier, where it is continuous and capped.	·15 → 7,45
FCF quality7 FCF / net income conversion · 0.51×100 %7 Window chosen: last 5 years (the best of those evaluated). Alternative · last 3 years: conversion 0.35× → 0 points. Stock-based compensation = 15 % of FCF: −0.8 points off the factor. Positive FCF in 5 of the 5 years in the window. High stock-based compensation relative to FCF.	·15 → 1,02
Debt53 Net debt / EBITDA · 1.35×100 %53 Interest coverage (EBIT / \|interest\|) = 19.2×.	·15 → 7,95
Return on invested capital (ROIC)78 Level (recency-weighted mean) · 24.3 %50 %97 Spread over the required return · +0.1 pp over the 10 % required30 %100 Trend · −25.0 pp over 5 years20 %0	·15 → 11,77
Weighted base	·100 → 39,84

Modifiers and penalties

The factors build the score; the modifiers correct it, within +23 / −28. Same 0–100 bar, 100 is always good.

Score	Range	Points
Gross margin trend · −12.0 pp accumulated over 4 years0	±8	-8,0
Altman Z'' · Z'' = 12.29100	0/−15	0,0
Shareholder returns · dilutes 0.2 % a year0 Effective buyback (net share count) · 0.2 % of dilution0 Dividend yield (last DPS / price today) · 1.1 % · does not count: the active branch is dilution—	+15/−5	-0,5
Impairment · 23 % · worst magnitude: fcf77 Earnings · 0.0 %100 Free cash flow · 23.0 %77 EBITDA · 0.0 %100	0/−12	-2,8
39,8 − 8,0 + 0,0 − 0,5 − 2,8 =28,5

Calculated on Sep 5, 2026

Score

Weight → points

Growth consistency9

Earnings · fit to the log-linear line · σ_resid = 0.10622 %0
Earnings · hit rate · 50 %16 %3
Earnings · volatility · σ = 0.18811 %33
Revenue · fit to the log-linear line · σ_resid = 0.06714 %0
Revenue · hit rate · 50 %11 %3
Revenue · volatility · σ = 0.1177 %75
Forward · trajectory coherence · consensus 35.7 % vs. trend -13.9 %20 %0

·20 → 1,90

Growth pace49

Realized · -10.4 %50 %0
Expected · 35.7 %50 %98

·20 → 9,75

No recent stagnation50

Realized slowdown · 1.61×50 %1
Expected slowdown · -3.42×50 %99
3-year earnings CAGR at or below zero (-16.9 %): the engine has slowed. It is scored on the acceleration scale, not cut — a binary cut turned a continuous fact into a cliff, and fired on 36 % of the universe.
Stagnation: 3-year earnings CAGR at or below zero. It is scored, not cut: the penalty is charged by the Impairment modifier, where it is continuous and capped.

·15 → 7,45

FCF quality7

FCF / net income conversion · 0.51×100 %7
Window chosen: last 5 years (the best of those evaluated).
Alternative · last 3 years: conversion 0.35× → 0 points.
Stock-based compensation = 15 % of FCF: −0.8 points off the factor.
Positive FCF in 5 of the 5 years in the window.
High stock-based compensation relative to FCF.

·15 → 1,02

Debt53

Net debt / EBITDA · 1.35×100 %53
Interest coverage (EBIT / |interest|) = 19.2×.

·15 → 7,95

Return on invested capital (ROIC)78

Level (recency-weighted mean) · 24.3 %50 %97
Spread over the required return · +0.1 pp over the 10 % required30 %100
Trend · −25.0 pp over 5 years20 %0

·15 → 11,77

Weighted base

·100 → 39,84

Score

Range

Points

Gross margin trend · −12.0 pp accumulated over 4 years0

±8

-8,0

Altman Z'' · Z'' = 12.29100

0/−15

0,0

Shareholder returns · dilutes 0.2 % a year0

Effective buyback (net share count) · 0.2 % of dilution0
Dividend yield (last DPS / price today) · 1.1 % · does not count: the active branch is dilution—

+15/−5

-0,5

Impairment · 23 % · worst magnitude: fcf77

Earnings · 0.0 %100
Free cash flow · 23.0 %77
EBITDA · 0.0 %100

0/−12

-2,8

39,8 − 8,0 + 0,0 − 0,5 − 2,8 =28,5