Texas Instruments Continues to Fuel the Tech Momentum

Texas Instruments Inc. (NYSE:TXN) today announced first-quarter revenue of $3.21 billion, net income of $658 million and earnings of $.52 cents per share. Analysts’ consensus earnings estimate was $.51 per share. TXN beat by a penny.

First Quarter 2010 Key Financial Information:

  • Orders were $3.64 billion, up 66 percent from a year ago and up 12 percent from the prior quarter.
  • Inventory was $1.28 billion at the end of the quarter, up $178 million from a year ago and up $74 million from the prior quarter.
  • Capital expenditures were $219 million in the quarter compared with $43 million a year ago and $436 million in the prior quarter.  Capital expenditures in the quarter were primarily for assembly/test manufacturing equipment, as well as for analog wafer manufacturing equipment.
  • The company used $504 million in the quarter to repurchase 20.6 million shares of its common stock and paid dividends of $149 million.

On a technical basis, Texas Instruments (NYSE: TXN) closed Monday at $27.16, tapping the 200-day moving average from the underside.

In terms of TXN’s 3 major product areas, here’s the breakdown:

Analog: Compared with a year ago, the increase in revenue was due to growth in all major product areas, especially high-volume analog & logic and power management products.

Embedded Processing: In both comparisons, revenue growth was primarily due to an increase in revenue from catalog products.  Revenue from automotive products also increased from a year ago, although to a lesser extent.

Wireless: Compared with a year ago, revenue grew primarily due to strength in connectivity products and applications processors.  Revenue from baseband products also grew from a year ago, although to a lesser extent.

Outlook

For the second quarter of 2010, TI expects:

  • Revenue:  $3.31 – 3.59 billion
  • Earnings per share:  $0.56 – 0.64

TI will update its second-quarter outlook on June 8, 2010.

Disclosure: No positions in the companies mentioned.

To get entry points, stop-loss points, and profit targets for my April watch list stocks and Featured Trade, simply try a 14-day complimentary trial by visiting here: Wall St. Cheat Sheet Premium Newsletter

More from The Cheat Sheet