Key Stats for Texas Instruments Stock
- 52-Week Range: $153 to $288
- Current Price: $281
- Street Mean Target: $275
- Street High Target: $330
- Analyst Consensus: 14 Buys / 2 Outperforms / 19 Holds / 1 Underperforms / 2 Sells
- TIKR Model Target (Dec. 2030): $450
What Happened?
Texas Instruments (TXN), an analog and embedded chipmaker whose components regulate power and convert real-world signals into digital data, reported Q1 2026 revenue of $4.83 billion, beating the $4.53 billion consensus estimate by more than $300 million.
The 19% year-over-year revenue growth was the fastest the company has posted since the pandemic-era inventory supercycle, and it came in above the top of TI’s own guidance range.
Industrial, TXN’s largest end market at roughly 35% to 40% of the analog chip total addressable market, surged more than 30% year-over-year and more than 20% sequentially.
The breadth of that industrial recovery was what separated this quarter from prior false starts: all sectors, all geographies, and all customer sizes grew sequentially for the first time in years.
Data center, which TXN formally added as a named segment this year to reflect its growing strategic weight, grew approximately 90% year-over-year and more than 25% sequentially as hyperscalers loaded AI racks with analog power management chips.
“Revenue came in above the top of the range as we saw continued acceleration in industrial and data center,” CEO Haviv Ilan said on the Q1 2026 earnings call.
Automotive held near peak levels, flat sequentially but still within one to two points of its all-time high, even as China incentive programs wound down.
Free cash flow on a trailing 12-month basis reached $4.35 billion, more than doubling from $1.7 billion a year earlier, as revenue growth returned and capital expenditure from TXN’s six-year, $50 billion fab investment cycle began to moderate.
TXN also announced in Q1 its agreement to acquire Silicon Labs, a wireless connectivity chipmaker focused on industrial IoT, for $7.5 billion, a deal expected to close in the first half of 2027.
Texas Instruments guided Q2 revenue between $5.0 billion and $5.4 billion, a midpoint of $5.2 billion that cleared the $4.86 billion Street consensus by more than 7% and triggered the stock’s largest single-day rally in over 25 years.
Wall Street’s Take on TXN Stock
The Q1 beat reframes TXN from a cyclical recovery story into something with a structural demand leg: data center analog content is now growing fast enough to move the overall revenue needle.
TXN’s revenue reached $17.68 billion in 2025 and consensus now projects it climbing to around $21 billion in 2026, a roughly 19% gain, with further growth to around $23 billion expected in 2027.
Fourteen analysts rate Texas Instruments stock a Buy or Strong Buy, with 2 Outperforms, 19 Holds, 1 Underperform, and 2 Sells in the current coverage mix; the mean price target of $274.94 sits fractionally below the current price, while the Street high of $330 implies roughly 17% upside from here.
The target spread from $200 to $330 captures a genuine debate: bears at Morgan Stanley (PT: $221, Underweight) argue data center strength is clear in the near term but durability is uncertain, while bulls at TD Cowen (PT: $300, Buy) and J.P. Morgan (PT: $280, Overweight) see secular and cyclical tailwinds extending well into 2027.
The signal is in Ilan’s pricing commentary: analog market prices were flat-to-stable in Q1 against a backdrop of rising demand, and management flagged the potential for price increases in the second half of 2026 as supply tightens — a dynamic that could drive meaningful upside to consensus EPS estimates.
The risk is second-half demand sustainability: TXN itself acknowledged the 2025 cycle saw a strong start followed by deceleration, and a repeat of that pattern would pressure margins and push EPS recovery further into 2027.
The catalyst is the Q2 print: the midpoint guide of $5.2 billion implies roughly 8% sequential growth, above seasonal, and Q2 results will answer whether industrial breadth and data center momentum are extending or stalling.
What Does the Valuation Model Say?
TIKR’s mid-case model projects Texas Instruments reaching a stock price of around $672 by December 2034, representing a roughly 139% total return from current levels, anchored to an around 11% revenue CAGR and net income margins expanding toward approximately 37% as the new 300-millimeter fab in Sherman, Texas ramps toward full utilization.
At around 36x forward earnings against a consensus EPS recovery from $5.59 in 2025 toward around $8 in 2026 and around $9 in 2027, and with TIKR’s model implying a target price of around $450 by December 2030, Texas Instruments stock is undervalued relative to its normalized free cash flow trajectory, with the market pricing in less than half the earnings recovery the model supports.
The tension in this investment case is whether the data center-driven acceleration is a structural re-rating event or a one-cycle surge.
If the bull case plays out:
- Data center revenue, already at roughly 10% to 11% of TXN’s business and growing 90% year-over-year, continues compounding as AI infrastructure CapEx sustains through 2027 and beyond
- Industrial revenue closes the gap to its 2022 peak, which management confirmed is still roughly 15% above current Q1 levels, adding a second growth driver on top of data center
- Pricing power materializes in the second half of 2026, as Ilan indicated is likely if demand remains strong, expanding gross margins back toward the mid-60% range
- The $7.5 billion Silicon Labs acquisition, expected to close in the first half of 2027, adds wireless connectivity scale and further diversifies the revenue base
- Free cash flow per share reaches $8 in 2026, per management’s own high-probability guidance, anchoring a valuation multiple on real cash generation rather than recovering GAAP earnings
If the bear case plays out:
- Second-half 2026 demand decelerates as it did in 2025, capping revenue growth in the mid-teens rather than the upper-teens consensus currently projects
- The Silicon Labs integration absorbs management bandwidth and drives GAAP EPS dilution in 2027 and 2028, making the normalized earnings recovery harder to see through the noise
- Morgan Stanley’s concern proves correct: data center analog demand proves lumpy, with customers front-loading orders in anticipation of supply tightness, creating an air pocket in 2027
- Inventory at 209 days, while strategically intentional, becomes a liability if growth slows and TXN is forced to bleed down stock for multiple quarters at lower prices
- The $330 Street high target already prices in an optimistic scenario, leaving limited margin for error at a 36x forward multiple
Should You Invest in Texas Instruments Incorporated?
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