TXN · Texas Instruments Incorporated · Stock research

Current Thesis

The beat-and-raise the market sold has now been followed by three weeks of nothing. Q2 2026 (2026-07-22) printed revenue $5.46B, +23% YoY, above the $5.00–5.40B guide, with EPS $2.14 against a $1.91 consensus, and the Q3 guide was lifted to $5.65–6.15B. Price went the other way — roughly $294.19 on 2026-07-22 to $279.90 on 2026-07-24 — and has not repaired since: $276.59 on 2026-08-12, $279.58 on 2026-08-14, with RSI(14) at 51.1 and the stock 15.4% below the $330.59 52-week high. The fundamental leg an investor is buying is the analog upcycle plus TI's data-center power content; what the tape is doing is holding that leg flat while the marginal buyer waits. No TI-specific event is scheduled inside 30 days. The narrative is maturing — confirmed, well-owned, and out of fresh fuel until the mid-September dividend action and the ~2026-10-20 print.

Bullish and bearish views on Texas Instruments Incorporated

The model's bull view on Texas Instruments Incorporated (TXN), in brief: Q2 2026 (2026-07-22): revenue $5.46B, +23% YoY; EPS $2.14 vs $1.91 consensus (+$0.23); gross margin 61.4%; operating profit +48% YoY to $2.31B. The bear view: A double beat with a raised guide produced a two-day decline and no subsequent reclaim: $294.19 (2026-07-22) → $279.90 (2026-07-24) → $279.58 (2026-08-14). Both cases follow in full.

Bull Case

• Q2 2026 (2026-07-22): revenue $5.46B, +23% YoY; EPS $2.14 vs $1.91 consensus (+$0.23); gross margin 61.4%; operating profit +48% YoY to $2.31B.
• Q3 2026 guide issued 2026-07-22: revenue $5.65–6.15B, EPS $2.23–2.57 — management widening the upturn rather than guiding it down.
• Cash generation per the Q2 report: trailing-12-month operating cash flow $8.67B, free cash flow $6.53B, 33.6% of revenue — funding the Sherman (TX) and Lehi (UT) 300mm build alongside the payout.
• Dividend cadence: the last increase was 4% to $1.42 per quarter, declared 2025-09-18, the 22nd consecutive annual raise. The 2026 decision typically lands in the third week of September.
• Sell-side arithmetic still points up: consensus target $312.12 as of 2026-08-13, 12.8% above the 2026-08-12 close of $276.59, with a $405 high mark on the panel.
• Management said on 2026-07-23 that AI data-center demand "will stay strong for the foreseeable future," which is the line carrying the second-order AI framing.
• Silicon Labs, $7.5B all-cash at $231 per share (announced 2026-02-04), cleared its HSR waiting period 2026-05-22 with a targeted close in H1 2027 — embedded wireless content added to the catalog, but a 2027 event.

Bear Case

• A double beat with a raised guide produced a two-day decline and no subsequent reclaim: $294.19 (2026-07-22) → $279.90 (2026-07-24) → $279.58 (2026-08-14). Twenty-one days of flat closes after good numbers is distribution absorbing demand, not accumulation.
• The panel disagrees with itself. On 2026-08-13 one compilation showed an average target of $312.12 with a range of $175 to $405 and a 2.52/4.0 rating score; a separate compilation surfaced the same week put the average at $297.76. Wide dispersion of that shape means the multiple, not the earnings line, is what is contested.
• Valuation carries the load: P/E 42.10 as of 2026-08-13 against a 39.69 market average on the same source. The re-rate is already in the price — the stock was +59.4% year-to-date at the 2026-08-12 close, from $173.49 at the start of 2026.
• Catalyst vacuum. Between 2026-08-16 and the ~2026-10-20 print there is one scheduled company event, the September dividend declaration, and it is a cadence item rather than a growth datapoint.
• The read-through risk is external: Analog Devices reports Q3 FY26 on 2026-08-19 at 7:00 a.m. ET (announced 2026-07-23). A soft bookings or sequential-order commentary from ADI resets the analog-cycle narrative for the entire group before TI gets a chance to answer.
• Hyperscaler capex remains the demand engine and remains jumpy — GOOGL and MSFT fell as much as 6% on 2026-06-22 on spending concerns.
• Mega-cap gravity caps velocity. The realistic bull outcome here is a grind back toward the outlier targets over quarters, not a repricing event.

Setup & Price Structure

• Reference close 2026-08-14: $279.58. 52-week high $330.59, so 15.4% below it. Three-month return -7.2%. RSI(14) 51.1 — mid-range, neither washed out nor extended.
• The post-print band is narrow and flat: $279.90 (2026-07-24), $276.59 (2026-08-12), $279.58 (2026-08-14). Price is within a few dollars of where the sell-the-news move ended.
• Overhead supply sits at the ~$294–308 June–July consolidation the stock lost after the print; above that, $330.59. A weekly close back above $308 would be the first evidence the June–July range has been recovered rather than abandoned.
• Below, the $272 area is the shelf the post-print range has been built on. It defines whether this is a base or a pause on the way down.
• Crowding observables, stated as observables: +59.4% YTD at the 2026-08-12 close while sitting 15.4% under the high; retrospective retail-facing coverage on 2026-08-11 ("$100 invested 15 years ago"), which is a single item and weak evidence on its own; no earnings inside 30 days, so no imminent print is forcing positioning; no insider transactions surfaced in the filings reviewed through 2026-08-14.
• The narrative is maturing, dated by the 2026-07-22 beat that failed to hold and the three headline-free weeks that followed it into 2026-08-14. It would flip to saturated on a loss of the $272 shelf combined with consensus targets drifting below the $312.12 mark recorded 2026-08-13.

Catalyst Calendar (next 30 days)

• ~2026-09-17 (est.) — TI board dividend action. Prior declarations landed 2025-09-18 (+4% to $1.42), 2022-09-15 and 2020-09-17. Falls just outside the 30-day window.
• ~2026-10-20 (est., after close) — Q3 2026 report against the $5.65–6.15B revenue and $2.23–2.57 EPS guide. Projected date per nextearningsdate.com as of 2026-08-10; TI has not confirmed. First report with Julie Knecht in the CFO seat.
• No confirmed TI-specific event falls inside the 30-day window.

Elapsed catalysts

• 2026-08-19 — Analog Devices Q3 FY26 results, 7:00 a.m. ET (date announced 2026-07-23). The nearest dated read on analog bookings, lead times and industrial/auto order patterns. Not a TI event, but it prices the group. (passed 7d ago)

What Would Change Our Mind

The whole frame rests on the shelf under the post-print range holding while the analog cycle keeps compounding. A weekly close below $272 breaks it and converts the current flat drift into a continuation of the July unwind; that is the gradeable line. Secondary conditions that would do the same work on the fundamental side: ADI on 2026-08-19 describing sequential order or bookings declines, a TI Q3 revenue print below the $5.65B guide floor, or a September dividend increase materially below the 4% cadence of 2025-09-18, which would read as capex crowding out cash return during the Sherman/Lehi build. In the other direction, a weekly close above $308 reclaims the June–July consolidation and would argue the sell-the-news phase is finished; a Q3 guide taking the run-rate above the top of the current range would restore the accelerating character the name lost on 2026-07-22.

Correlation Notes

• Analog peers ADI, MCHP, NXPI, ON and STM move TXN on cycle datapoints; ADI's 2026-08-19 print is the group's next input and TI has no answer until ~2026-10-20.
• TXN trades as the analog-cyclical proxy inside SOX/SMH, with a data-center-power kicker; it does not trade with the accelerator complex on a one-to-one beta.
• Hyperscaler capex guidance (GOOGL, MSFT, AMZN, META) drives the data-center revenue line management flagged on 2026-07-23; the 2026-06-22 6% drawdown in GOOGL/MSFT on spending concerns is the transmission channel.
• Industrial and automotive were named the Q2 growth leaders on 2026-07-22, which ties the name to PMI-type macro prints as much as to AI headlines.
• The Silicon Labs deal is all-cash at $231 per share, so the SLAB spread tracks closing risk and timing, not the TXN share price.
• With 22 consecutive years of dividend increases, part of the shareholder base is rate-sensitive income money — long-end yield moves affect the multiple independently of the semiconductor cycle.