Texas Instruments Incorporated (TXN) closed at $266.54, up 1.82 percent, outperforming the S&P 500's 0.72 percent gain and the Nasdaq's 1.57 percent rise.
Citi Research raised its price target to $345—a 29.8 percent increase from current levels—and reiterated TXN as its top semiconductor pick. The firm's thesis centers on Texas Instruments' commanding position in power delivery for AI servers. As data centers scale their AI infrastructure, demand for power semiconductors accelerates. TXN's broad analog portfolio and large-scale manufacturing footprint position it to capture outsized share gains.
The stock now trades 5.5 percent below its 52-week high of $331.51. Shares are down 3.51 percent over the past month, underperforming the Computer and Technology sector's 5.02 percent gain and the S&P 500's 3.68 percent advance—a gap that could close if the Citi thesis holds.
The earnings backdrop is strong. Consensus forecasts $2.37 in EPS for the next quarter, a 60.14 percent year-over-year increase, and $5.91 billion in revenue, up 24.69 percent. For the full year, Zacks Consensus projects $8.42 EPS (up 54.5 percent) and $21.7 billion in revenue (up 22.73 percent).
Citi's conviction is reflected in analyst revisions. Over the past month, Zacks Consensus EPS estimates for TXN have risen 0.82 percent, signaling growing confidence in the company's profitability trajectory. TXN holds a Zacks Rank of #2 (Buy).
On valuation, TXN trades at a forward P/E of 31.1, a discount to the Semiconductor - General industry average of 37. The PEG ratio of 1.03 sits above the industry average of 0.72, suggesting growth is priced in but not richly. The Semiconductor - General industry ranks 33 among over 250 industries—top 14 percent performance.
