Needham & Company Reiterates a 'Buy' on Texas Instruments (TXN); Closes National Semiconductor Acquisition; Model Adjustments
TXN Hot Sheet
Rating Summary:15 Buy, 12 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 20 | Down: 11 | New: 38
Needham & Company reiterates a 'Buy' on Texas Instruments (NYSE: TXN) price target of $36.00.
Needham analyst says, "TI closed on its acquisition of National Semiconductor (Not/Rated) last week after the transaction received all of the required regulatory approval. This cash deal, which was valued at roughly $6.5B, was originally announced on April 4 and closed earlier than the originally expected 6-9 month time frame. TI’s market share in analog will invariably grow as it levers its now decisively massive portfolio of 45K products. The combined company is expected to derive over 50% of its revenue from Analog products and focus TI more on the Industrials end market. The primary benefit is that TI’s sales force can expand NSM's addressable market. However we believe that despite TI treating NSM as a separate business, this integration will detract from TI's strong customer sales and service reputation. Our original expectations for modest accretion on this transaction have been tempered by the overall macro conditions and we are also cutting into our 2012 projections out of conservatism. We adjusted our 2011 revenue/EPS from $13.4B/$2.25 to $13.8B/$2.25 and our 2012 revenue/EPS from $14.1B/$2.60 to $15.4B/$2.55."
For more ratings news on Texas Instruments click here and for the rating history of Texas Instruments click here.
Shares of Texas Instruments closed at $27.40 yesterday, with a 52 week range of $24.34-$36.71.
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Needham analyst says, "TI closed on its acquisition of National Semiconductor (Not/Rated) last week after the transaction received all of the required regulatory approval. This cash deal, which was valued at roughly $6.5B, was originally announced on April 4 and closed earlier than the originally expected 6-9 month time frame. TI’s market share in analog will invariably grow as it levers its now decisively massive portfolio of 45K products. The combined company is expected to derive over 50% of its revenue from Analog products and focus TI more on the Industrials end market. The primary benefit is that TI’s sales force can expand NSM's addressable market. However we believe that despite TI treating NSM as a separate business, this integration will detract from TI's strong customer sales and service reputation. Our original expectations for modest accretion on this transaction have been tempered by the overall macro conditions and we are also cutting into our 2012 projections out of conservatism. We adjusted our 2011 revenue/EPS from $13.4B/$2.25 to $13.8B/$2.25 and our 2012 revenue/EPS from $14.1B/$2.60 to $15.4B/$2.55."
For more ratings news on Texas Instruments click here and for the rating history of Texas Instruments click here.
Shares of Texas Instruments closed at $27.40 yesterday, with a 52 week range of $24.34-$36.71.
Discover Wall Street's best ratings calls with the pros - Ratings Insider Elite. Free Trial!
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