RBC Capital downgraded chipmaker Texas Instruments (TXN) from Outperform to Sector Perform on Tuesday as part of a broader downgrade of its semiconductor sector outlook. RBC lowered its price target for the company from $32 to $28, which is below the recent closing price for the stock.
“TXN’s commentary during its mid-quarter update on weakening end-market health, slowing order trends, and lean customer inventory environment is concerning given TXN broad scale, ~4.5% of the total semiconductor market and ~17% of the analog market,” said analyst Doug Freedman. “We acknowledge that this cycle is an anomaly as broader demand softening is atypical through this time frame, and especially to TXN given its consumer exposure is often a catalyst to 2H revenues.”
TXN shares closed at $29.10 on Monday and were down more than 1% in pre-market trading on Tuesday.
The Bottom Line
Shares of Texas Instruments (TXN) have a 2.34% dividend yield, based on last night’s closing stock price of $29.10. The stock has technical support in the $26-$27 price area. If the shares can firm up, we see overhead resistance around the $30-$32 price levels.
Texas Instruments (TXN) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.2 out of 5 stars.
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