Texas Instruments (TXN) PT Lowered to $215 at BofA Securities
BofA Securities analyst Vivek Arya lowered the price target on Texas Instruments (NASDAQ: TXN) to $215.00 (from $220.00) while maintaining a Neutral rating.
The analyst comments "Reiterate Neutral as: 1) we don't yet see the lift-off in TXN sales growth (largest segment industrial continues to decline), 2) rising depreciation creates 300bps+ headwind to CY25 GM which doesn't appear to be fully captured in consensus estimates, 3) even assuming above-seasonal ~10% QoQ each growth in Q2/Q3'25 doesn't generate better than 10-12% YoY sales growth for CY25 (vs. expectations of mid-teens growth), and 4) China strength could indicate pull-ins ahead of US elections/potential tariffs (Q2/Q3 sales up 20%/10% QoQ overall inc. up 20%/20% in autos, plus continued Q4E growth). On the positive side, TXN continues to build a comprehensive manufacturing footprint that could provide low-cost capacity in next upcycle. Overall, we tweak down CY25E by 2% to $5.55 from $5.69 and lower our PO to $215 from $220 on lower 46x EV/FCF (vs. 47x prior) but within 18x-50x historical range."