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Building up an investment case requires looking at a stock holistically. Today I’ve chosen to put the spotlight on Texas Instruments Incorporated (NASDAQ:TXN) due to its excellent fundamentals in more than one area. TXN is a financially-sound , dividend-paying company with a an impressive track record of performance. In the following section, I expand a bit more on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the full report on Texas Instruments here.
Solid track record established dividend payer
In the previous year, TXN has ramped up its bottom line by 34%, with its latest earnings level surpassing its average level over the last five years. This strong performance generated a robust double-digit return on equity of 64%, which is an optimistic signal for the future. TXN’s strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This implies that TXN manages its cash and cost levels well, which is an important determinant of the company’s health. TXN’s has produced operating cash levels of 1.17x total debt over the past year, which implies that TXN’s management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
TXN is also a dividend company, with ample net income to cover its dividend payout, which has been consistently growing over the past decade, keeping income investors happy.
Next Steps:
For Texas Instruments, there are three relevant aspects you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for TXN’s future growth? Take a look at our free research report of analyst consensus for TXN’s outlook.
- Valuation: What is TXN worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether TXN is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of TXN? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.