Stock Analysis | Texas Instruments Outlook - A Weak Technical Picture But Mixed Fundamental Signals

Market Snapshot

Headline Takeaway: Texas Instruments (TXN) is under pressure, with shares down 8.80% recently and a weak technical outlook suggesting caution. However, the fundamental backdrop offers a more nuanced story.

News Highlights

Recent news across the semiconductor sector has been mixed, with both positive and negative implications for Texas Instruments:

• Tariff Uncertainty — New analysis from McKinsey highlights ongoing uncertainty around U.S. semiconductor tariffs, which could affect supply chains and long-term demand for Texas Instruments' chips.
• Semiconductor ETF Outflows — The US Semiconductors ETF (SOXX) saw a $750 million net outflow in May 2025, suggesting reduced investor appetite for the sector and potentially affecting TXN.
• Japan-U.S. Cooperation Proposals — Japan is reportedly considering U.S. proposals for greater cooperation in rare earths and semiconductor supply chains, which could create new opportunities for companies like Texas Instruments in the long term.

Analyst Views & Fundamentals

The analyst landscape is mixed. Only one analyst, Vivek Arya from B of A Securities, has issued a recent rating of "Neutral" for TXN. The simple average analyst rating is 3.00, while the historical performance-weighted rating is 0.00, due to the analyst’s poor historical win rate of 0.0%. This lack of confidence among analysts contrasts with some positive fundamental metrics:

• GPOA (Gross Profit on Assets): 7.37% – internal diagnostic score: 3.00
• EV/EBIT: 136.78 – internal diagnostic score: 2.00
• GPM (Gross Profit Margin): 57.89% – internal diagnostic score: 3.00
• Cash-UP (Cash per Share): $0.86 – internal diagnostic score: 3.00
• Net cash flow from operating activities per share (YoY growth rate %): 5.14% – internal diagnostic score: 1.00
• Net profit attributable to parent company shareholders / Net profit (%): 99.47% – internal diagnostic score: 1.00

While some metrics like GPM and GPOA show strength, others such as EV/EBIT and operating cash flow growth are weaker, leading to a moderate fundamental score of 3.35 (out of 10). This indicates that while the company remains financially stable, the recent market pullback is not fully justified by fundamentals alone.

Money-Flow Trends

The flow of capital into Texas Instruments has been uneven. While large and extra-large money managers are showing a positive trend, retail and mid-sized investors are trending negative. Notably:

• Small-inflow ratio: 49.80% – trend: negative
• Medium-inflow ratio: 49.85% – trend: negative
• Large-inflow ratio: 49.06% – trend: negative
• Extra-large-inflow ratio: 57.85% – trend: positive
• Overall inflow ratio: 54.42% – trend: positive

This suggests big money is cautiously optimistic, but retail investors are pulling back, perhaps in response to the recent price decline. The fund-flow score is 7.56 (out of 10), indicating a generally positive reading for institutional flows.

Key Technical Signals

Technically, Texas Instruments is showing a weak chart pattern, with more bearish signals than bullish ones. The technical score is 2.75 (out of 10), and the overall trend is bearish, advising investors to "avoid" the stock for now:

• RSI Overbought – internal diagnostic score: 1.00 (bearish)
• MACD Death Cross – internal diagnostic score: 1.00 (bearish)
• Bearish Engulfing – internal diagnostic score: 1.15 (bearish)
• RSI Oversold – internal diagnostic score: 8.14 (bullish)
• WR Overbought – internal diagnostic score: 2.48 (neutral)

Recent chart patterns also highlight volatility, with the MACD Death Cross and RSI Oversold both emerging in the past week. The key insight is that bearish indicators (4) outnumber bullish ones (1), and the technical momentum is clearly weak. Investors should be wary of further downside risks in the short term.

Conclusion

Texas Instruments is facing a mixed environment: fundamentally stable, but technically weak, with a confused analyst outlook and mixed money flows. While institutional money is cautiously optimistic, retail and mid-sized investors are pulling back, and technical indicators suggest caution.

Actionable Takeaway: Consider waiting for a clearer breakout or a strong earnings report to gauge momentum. In the meantime, given the weak technical environment, it may be wise to avoid new positions in TXN until the price stabilizes.