Texas Instruments shares fell 2.47% to close at $284.02 on Monday, marking an 8.81% decline over the past week. This drop occurred even as Morgan Stanley raised its earnings estimates for the semiconductor company’s second and third quarters.
Upgraded Earnings on Sustained Semiconductor Recovery
Morgan Stanley highlighted above-seasonal growth for Texas Instruments in both the June and September quarters. The firm cited continued strength in analog and industrial chip segments, growth in data center demand, and stable pricing trends as key factors supporting the improvement.
The investment bank’s AlphaWise distributor survey for Q2 2026 revealed that momentum gained in Q1 is persisting into September. None of the surveyed distributors anticipate declines in analog or microcontroller units, and industrial demand remains stable. Automotive sector results varied. Although shipments exceed demand, inventory-building has moderated, which Morgan Stanley views as measured continuation rather than a warning.
Pricing stability and solid forward expectations indicate a recovery driven by demand rather than broad inventory restocking. Some pockets of supply tightness are noted. Despite the upward revisions, Morgan Stanley maintained its underweight rating on TXN shares.
Dividend Declared as Share Price Retraces Gains
Last week, Texas Instruments declared a quarterly cash dividend of $1.42 per share, payable on August 11, 2026, to shareholders of record on July 31. The dividend announcement came amid a price pullback after significant gains.
Over the past year, TXN delivered a total shareholder return of 34.79%, although it has faced recent volatility. Valuation perspectives remain mixed, ranging from a bull case target of $435.69 based on capacity expansion and cash generation to a more conservative discounted cash flow model valuing the stock at $233.65, implying overvaluation at current prices.
This article provides informational content and is not financial advice.
