FBR Capital Maintains an 'Outperform' on Texas Instruments (TXN); Still Solid Results with Some Japan Supply Chain

FBR Capital maintains an 'Outperform' on Texas Instruments (NYSE: TXN), PT $40.

FBR analyst says, "Texas Instruments (TI) reported 1Q11 financial results largely as expected, with inline revenues of $3.4B (–4% QOQ, +6% YOY), and with some gross margin (100 bps) and EPS ($0.02) impacts from the Japanese earthquake and related disruptions. For 2Q11, management guided revenues to grow 1%–9% sequentially, in line with the Street, but with lower-than-expected gross margins hitting EPS guidance, as many expected. For 2Q11, TI said lingering Japanese earthquake impacts would drive $0.05 of revenue bad news as Japanese customer demand is hit, and $0.05 of gross margin bad news as its Japanese fabs ramp back into production. So, management claims that 2Q11 EPS guidance of $0.52–$0.60 would have been closer to $0.62–$0.70 without the Japanese earthquake, solidly better than the Street's $0.63."

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 $34.79 yesterday.

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