Balance sheet analysis
Texas Instruments had total assets of $32.3 billion, current assets of $15.1 billion, property, plant and equipment of $10 billion, and goodwill of $4.36 billion as of December 31, 2023.
Total current liabilities were $3.3 billion as of December 31, 2023.
The current ratio was 4.6 times for 2023.
Total liabilities were $15.5 billion at December 31, 2023.
The debt ratio was 48% for 2023.
Combined with cash flow, the balance sheet is very healthy.
Profitability analysis
Revenue was $17.5 billion, $20 billion and $18.3 billion in 2023, 2022 and 2021, respectively.
Revenue in 2023 was down 12.5% year-on-year.
Revenue in 2022 was up 9.3% year-on-year.
Net income was $6.5 billion, $8.7 billion and $7.8 billion in 2023, 2022 and 2021, respectively.
Cash flow analysis
Cash flows from operating activities were $6.4 billion, $8.7 billion and $8.75 billion in 2023, 2022 and 2021, respectively.
Capital expenditure was $5 billion, $2.8 billion and $2.5 billion in 2023, 2022 and 2021, respectively.
Dividends paid were $4.6 billion, $4.3 billion and $3.9 billion in 2023, 2022 and 2021, respectively.
Capital expenditure is essential for Texas Instruments.
We could see that the capital expenditure increased in 2023, but revenue declined.
Insufficient utilization in fixed asset is not a question, but maintaining a high level of capital expenditure is a challenge without generating revenues.
If maintaining a high level of capital expenditure, cash dividends might be reduced.
Maybe a bit pessimistic , but the amount of cash dividends is a standard for measuring shareholders returns.
Texas Instruments’ operating results for Q1 2024.
Revenue decreased $720 million or 16.4% to $3.66 billion for three months ended March 31 2024, compared to $4.38 billion for three months ended March 31, 2023.
Net income was $1.1 billion and $1.8 billion in Q1 2024 and Q1 2023.
Net income in Q1 2024 was down 39% year-on-year.
Conclusion
Texas Instruments stock price is $194.97 per share, which is equivalent to $177.52 billion in market capitalization.
We maintain that the stock price is overestimated and we reckon that Texas Instruments’ reasonable valuation is $80 billion.
We hope that its dividend yield is more than 5%.
Disclaimer: The content is for reference only and does not constitute investment advice.
Introduction
We design and manufacture semiconductors that we sell to electronics designers and manufacturers all over the world. Our operations began in 1930, and we are incorporated in Delaware. With headquarters in Dallas, Texas, we have design, manufacturing or sales operations in more than 30 countries. Our two reportable segments are Analog and Embedded Processing, and we report the results of our remaining business activities in Other. In 2023, we generated $17.52 billion of revenue.
