Definitive Analysis
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Definitive Analysis

Financial Statements

Mode

Ticker

Industry

Sector

Texas Instruments Incorporated (TXN)

Company Dividend Discount ModelIndustry: SemiconductorsSector: Technology

Valuation Snapshot

Stable Growth$45.37 - $67.42$55.89
Multi-Stage$70.26 - $76.65$73.40
Blended Fair Value$64.64
Current Price$183.73
Upside-64.82%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS9.77%13.74%5.244.984.694.253.743.292.792.301.801.58
YoY Growth--5.22%6.05%10.58%13.43%13.90%17.73%21.44%27.83%13.99%9.15%
Dividend Yield--2.92%2.88%2.52%2.31%1.98%3.29%2.57%2.21%2.23%2.75%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)5,043.00
(-) Cash Dividends Paid (M)4,949.00
(=) Cash Retained (M)94.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)1,008.60630.38378.23
Cash Retained (M)94.0094.0094.00
(-) Cash Required (M)-1,008.60-630.38-378.23
(=) Excess Retained (M)-914.60-536.38-284.23
(/) Shares Outstanding (M)915.25915.25915.25
(=) Excess Retained per Share-1.00-0.59-0.31
LTM Dividend per Share5.415.415.41
(+) Excess Retained per Share-1.00-0.59-0.31
(=) Adjusted Dividend4.414.825.10
WACC / Discount Rate9.53%9.53%9.53%
Growth Rate-0.17%0.83%1.83%
Fair Value$45.37$55.89$67.42
Upside / Downside-75.30%-69.58%-63.31%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)5,043.005,084.935,127.215,169.845,212.835,256.175,413.86
Payout Ratio98.14%96.51%94.88%93.25%91.63%90.00%92.50%
Projected Dividends (M)4,949.004,907.414,864.784,821.114,776.374,730.565,007.82

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.53%9.53%9.53%
Growth Rate-0.17%0.83%1.83%
Year 1 PV (M)4,436.004,480.434,524.87
Year 2 PV (M)3,975.044,055.074,135.91
Year 3 PV (M)3,560.943,669.023,779.27
Year 4 PV (M)3,189.003,318.713,452.33
Year 5 PV (M)2,855.013,000.903,152.69
PV of Terminal Value (M)46,285.5748,650.6751,111.47
Equity Value (M)64,301.5667,174.8070,156.53
Shares Outstanding (M)915.25915.25915.25
Fair Value$70.26$73.40$76.65
Upside / Downside-61.76%-60.05%-58.28%

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