Texas Instruments: Sell Rating Maintained Amid Uneven Recovery, Stretched Valuation, and Long-Term Margin Pressure

Analyst Joseph Moore of Morgan Stanley maintained a Sell rating on Texas Instruments, boosting the price target to $180.00.

Joseph Moore has given his Sell rating due to a combination of factors that, in his view, limit Texas Instruments’ risk‑reward profile despite a solid near-term recovery. He acknowledges that the latest quarter was decent, with revenue in line and margins better than expected, and that the March quarter outlook points to slightly stronger-than-normal seasonal growth. However, he believes the market reaction has been excessive, as the stock’s sharp post‑earnings move is not justified by only modest changes to his estimates and by a recovery that remains less consistent than that of key analog peers.
Moore also remains cautious on the company’s longer-term earnings and cash generation outlook. His projections for 2026 and 2027 earnings per share stay below consensus, reflecting concerns that gross margins and free cash flow will be under pressure for an extended period, in part due to elevated capital spending. He continues to model future revenue below the company’s prior long‑term framework and is waiting for additional consecutive quarters of growth before gaining confidence in the durability of the upturn. Taken together—uneven recovery versus competitors, stretched valuation after the rally, and a more challenged margin and FCF trajectory—these considerations support his Underweight/Sell stance on the stock.

In another report released today, Barclays also maintained a Sell rating on the stock with a $175.00 price target.