Highly Regarded

Is Texas Instruments Inc. (TXN) Stock Undervalued or Overvalued?

Trailing-twelve-month multiples vs Technology sector peers in our coverage

31% Discount TTM fundamentals · sector averages from covered peers

TXN trades at 52.1× TTM earnings — a 31% discount to its Technology sector average of 76.0× in our coverage.

The Numbers

P/E (TTM)

52.1×

Sector avg: 76.0×

P/S (TTM)

14.6×

Sector avg: 17.8×

Market Cap

$257.72B

EPS (TTM): $5.45

Revenue (TTM)

$17.68B

Net income: $5.00B

Technology Peer Comparison

How TXN's multiples stack up against sector peers we cover. Click any peer for its own valuation breakdown.

Stock Price P/E (TTM)
TXN This page $283.97 52.1×
NVDA $202.77 50.2×
AAPL $333.66 42.2×
MSFT $393.89 24.6×
AVGO $370.92 77.8×
AMD $495.65 187.0×
INTC $94.98 —
CSCO $111.92 43.2×
ORCL $126.41 29.3×
PLTR $132.35 307.8×
QCOM $171.79 34.7×
CRM $170.83 24.8×
ADBE $237.22 14.2×

Is the Discount Justified?

July 12, 2026

Texas Instruments' P/E of 57.1x is below the technology sector average of 76.4x. The company reported strong Q1 2026 revenue growth, increasing 9% sequentially and 19% year-over-year, primarily driven by demand in the industrial and data center markets. TXN maintains a robust market position in the industrial and automotive semiconductor segments, benefiting from diversified end-market exposure. The company is committing substantial capital expenditures, projected between $2 billion and $3 billion in 2026, to expand domestic manufacturing capacity. While these investments are strategic for long-term competitiveness, they temporarily divert cash. Despite this, TI's free cash flow generation is expected to exceed market expectations, supported by a strong gross profit margin of 57%.

Sources

Frequently Asked Questions

Is TXN overvalued or undervalued?
On trailing-twelve-month earnings, TXN trades at 52.1x versus a Technology sector average of 76.0x in our coverage — a 31.4% discount. Whether that's justified depends on growth, margins, and risk; see the context above.
What does the P/E ratio tell you?
Price-to-earnings compares a company's share price with its per-share profits. A higher multiple means investors pay more per dollar of earnings — often for faster expected growth — while a lower one can signal slower growth or higher perceived risk.
Why compare against the sector average?
Valuation multiples vary structurally between industries — software typically trades richer than banks or energy. Comparing TXN with its own Technology peers is more informative than comparing against the whole market.
Is a cheap stock automatically a good buy?
No. A discount can be justified by weak growth or elevated risk (a "value trap"), and a premium can be earned by quality and consistency. Valuation is one input — pair it with the fundamentals and the AI context on this page.

Methodology

Multiples are computed from trailing-twelve-month fundamentals (from company filings) and the latest share price: P/E is price ÷ diluted EPS, and P/S is market cap ÷ revenue. Sector averages use the Technology names in our 50-stock coverage with positive earnings — a deliberately like-for-like, if imperfect, benchmark.

Stocks with negative trailing earnings are compared on price-to-sales instead. Multiples update with prices and fundamentals; AI context refreshes weekly.

Not Financial Advice

This page is for education and information only. Indicators are mechanical calculations, AI commentary can contain errors, and nothing here is a recommendation to buy or sell any security. Do your own research and consider consulting a qualified financial advisor. See our full disclaimer.

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