Texas Instruments - A high quality compounding machine
Check out my latest report on $TXN

Run by a great management team that has a laser focus on long term value to shareholders by targeting effective free cash flow per share growth and a plan to return 100% to shareholders with dividends and share repurchases. image

Margins and returns on capital have been improving steadily for over a decade as they increase their efforts to manufacture more on the cost advantaged 300 mm wafer. Billions in capex will be spent going forward on this very thing.


They enjoy a slow moving tech with long lifecycles for their products - years and in some cases decades.

They offer 80,000 products to over 100,000 customers and are currently trying to get closer to those customers in an effort get repeat business and understand the future needs.

The business has risks as well, the largest in my opinion is the 55% of sales from China.

Check it out for more…[paywall with free trial and 25% off for a year offer available inside]

Leandro's avatar
This is an outstanding company which is a direct consequence of an outstanding management team
Simon Handrahan's avatar
yeah they made it happen. seem very long term focused compared to much of the others in the industry.
Stock Metal Investment's avatar

He talks a lot about their 10-15 year road map in this one . Gems like this" And in fact, if it wants to do more, if we're getting encouragement from customers, and I don't mean orders in the next year or two, because that's all garbage.
I mean, relationships that we can truly turn into design wins, the encouragement we're getting is that we ought to think even more ambitiously."

Love when a CEO talks about 1-2 year contract as "that's all garbage" xD
Simon Handrahan's avatar
@stonkmetal thanks i’ll take a look! love the long term focus. “garbage” lol sounds like me therefore i like.
Preston | Investor Insight's avatar
From a TA perspective, this looks like a buyable dip candidate under $110.
Young Money Capital's avatar
I need to read this later and see your opinion. I researched them and passed up on them because of fears about end-market weakness.
Simon Handrahan's avatar
@youngmoneycapital that’s a reasonable thing to consider as a risk. i’ll admit i’m not a semi industry expert and because of that, i’d limit my position size.
Paul Cerro's avatar
Great write up Simon!
Simon Handrahan's avatar
@paulcerro thanks so much for the support!