FBR Capital Raises Price target on Texas Instruments (TXN) Following 3Q EPS Beat
FBR Capital reiterated a Market Perform rating on Texas Instruments (NASDAQ: TXN), and raised the price target to $58.00 (from $55.00), following the company's 3Q15 earnings report. TXN's revenue was $3.43 billion, better than the Street's estimate of $3.29 billion. GAAP EPS of $0.76 was better than consensus estimates of $0.68.
Analyst Christopher Rolland commented, "On Wednesday, October 21, TI announced better-than-expected 3Q15 results and 4Q15 guidance as the company benefitted from broad-based strength across all its business segments. While gross margins were a bit light, investors are likely to give it a pass as it worked down more than $100 million in inventories during the quarter (DOIs of 127 last quarter have been a sticking point with bears). If we were to nitpick, the sequential drop in expected 4Q15 revenue of –6% quarter over quarter was a bit worse than seasonal (although the company may have just been sandbagging). We were also somewhat surprised to see shares up almost 10% in the aftermarket, particularly as the stock had surged in the few weeks before the print. Regardless, given the solid execution and better-than-expected results, we increased our 2016E EPS from $2.75 to $2.86 and our price target to $58 from $55."
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Shares of Texas Instruments closed at $51.90 yesterday.