Key Stats for Texas Instruments Stock
- Past-Month Performance: 20%
- 52-Week Range: $140 to $231
- Valuation Model Target Price: $324
- Implied Upside: 43%
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What Happened?
Texas Instruments stock surged about 20% in the last 30 days, finishing near $226 per share as investors rotated back into high-quality semiconductor names and reacted to a major strategic acquisition announcement. Shares climbed back toward their $231 52-week high, signaling renewed confidence in the company’s embedded processing and industrial recovery outlook.
The stock moved sharply higher primarily because investors viewed TI’s agreement to acquire Silicon Labs for $231 per share in cash as a strategic move that strengthens its long-term growth profile in embedded wireless connectivity.
The deal expands TI’s portfolio with 1,200 wireless connectivity products and is expected to generate more than $450 million in annual manufacturing and operational synergies within three years after closing.
Management projects the transaction to close in the first half of 2027, and CFO Rafael Lizardi said the company plans to fund the acquisition with cash on hand and about $7 billion in incremental debt while continuing to return 100% of free cash flow to shareholders.
CEO Haviv Ilan described wireless connectivity as an “alpha socket” that can unlock cross-sell opportunities across power management and embedded processors, reinforcing the strategic logic behind the move.
Beyond the acquisition, investors are also responding to improving forward fundamentals. Revenue is projected to rebound from $17,682 million in 2025 to $19,576 million in 2026, following the downturn seen between 2022 and 2024.
That expected recovery, combined with TI’s internal 300-millimeter manufacturing footprint, supports margin expansion as volumes normalize across industrial and embedded markets.
Taken together, the acquisition-driven growth story and signs of cyclical recovery helped drive the 20% rally in the last 30 days as investors repositioned for stronger earnings visibility into 2026.
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Is Texas Instruments Undervalued?
Under valuation assumptions, the stock is modeled using:
- Revenue Growth (CAGR): 10.8%
- Operating Margins: 39.2%
- Exit P/E Multiple: 30.0x
Revenue growth assumptions reflect continued stabilization in industrial demand and rising semiconductor content in connected systems.
Revenue is projected to increase from $17,682 million in 2025 to $19,576 million in 2026 and continue expanding through 2028, aligning with a 10.8% forward CAGR.
Margin assumptions are supported by TI’s internal manufacturing strategy. The company operates low-cost 300-millimeter wafer fabs that lower per-unit costs and increase operating leverage as utilization improves.
As volumes recover, fixed costs are absorbed across higher output, supporting durable operating margins near the modeled 39.2% level.
The Silicon Labs acquisition enhances this setup by adding embedded wireless connectivity products that often anchor system designs.
Wireless connectivity typically serves as a core component in connected devices, creating cross-selling opportunities into power management, sensing, and higher-performance embedded processors, which can increase content per system.
Based on these inputs, the model estimates a target price of $324.41, implying 43.4% total upside from the current $226.16 share price and an annualized return of 13.3% through 2026 under the model framework. Under this scenario, Texas Instruments appears undervalued at current levels.
Future performance will depend on sustained industrial recovery, continued automotive semiconductor content growth, and execution on integrating Silicon Labs into TI’s manufacturing network. The setup reflects improving earnings visibility driven by embedded connectivity expansion, manufacturing scale advantages, and disciplined capital allocation.
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