Rating
Hold
Price target
$225
Previous
$190
Implied upside
+14%

Cantor Fitzgerald analyst Matthew Prisco raised the price target on Texas Instruments (NASDAQ: TXN) to $225.00 (from $190.00) while maintaining a Neutral rating.

“This was a surprisingly positive print for TXN, posting the first guide for sequential growth in 1Q since 2010, and leading to better-than-expected GM trends (still down slightly Q/Q in 1Q, but off a much higher base).

Mgmt. is calling for an ongoing recovery supported by order/backlog growth and turns business, which continues to run at a higher level – with Data Center strength and broad-based Industrial recovery the bright spots within today’s backdrop (where we believe 1Q guide implies ~HSD% Q/ Q growth in Industrial).

Elsewhere, mgmt. expects pricing to decline LSD % in CY26 (same as CY25), reiterated their CY26 capex guide (~$2-3B), reduced their CY26 depreciation guide to $2.2-2.4B (vs prior low-end of $2.3-2.7B), and now expects CY27 depreciation to tick higher (vs our prior expectations for a ~$200-300M decline Y/Y).

Overall, a much more positive print than we had expected, and one that should continue to support the bull thesis of $9-10 of FCF in CY27.

From here, we continue to expect a gradual recovery with pockets of secular growth as evidenced in TXN’s commentary (i.e., Data Center + ADEF), but believe that the positivity in this print will likely drive increased focus on FCF (particularly into the company’s Capital Management Presentation on Feb 24th).

And with $9/sh in FCF now more achievable in CY27, we are raising our PT to $225 (from $190) based on a 25x multiple.

So still some room to grind higher as investors become more positive on the Analog trade, though we reiterate our Neutral rating as we continue to see better upside elsewhere within Analog.”

This research note is reproduced verbatim from the issuing firm. Price Target never edits, paraphrases or alters analysts’ words — we only republish them in one place.

Share

Share on