Texas Instruments' Big Analog Move

Texas Instruments is to acquire National Semiconductor for 6.5 billion dollars,or 25.00 a share.Funded with a combination of cash and debt,the deal is expected to close in 6-9 months.
For Texas Instruments,this is a bolstering of its analog chip business,moving away from the less profitable wireless business and toward touch and power management applications.
According to Nick Calamos of Calamos Imvestments,you really need to have scale to compete globally.It's a volume monetization type of business.You need to push out hundreds of millions of these chips.They are staking their future on analog.
Calamos Investments offers services to both individuals and institutions,with specialties in risk management and alternative investment strategies.Originated in 1977,it markets both open and closed-end funds and separately-managed accounts,employing a proprietary security evaluation system.
Texas Instruments(TXN),National Semiconductor(NSM)

Texas Instruments,Intel Upgraded

Texas Instruments has been upgraded to overweight from neutral by JP Morgan.It has a new price target of 47.00.The upgrade stems from the impending end to the semiconductor inventory correction.
RW Baird has raised Intel from neutral to outperform.The price target has been raised from 25.00 to 27.00.The upgrade is because of continued rebounds in demand for Intel's products.Wells Fargo seconds this view of Intel.
Meanwhile,outside the semi space,Google continues to look for acquisitions.These are to be small,innovative firms along the lines of last year's purchases.
Texas Instruments(TXN),Intel Corporation(INTC),Google(GOOG)

Hodges Still Likes Texas Instruments

Texas Instruments has reported earnings of 0.71 a share,versus an estimate of 0.69;and revenue of 3.74 billion dollars,versus an estimate of 3.69.Eric Marshall of Hodges Capital Management says they are positive on TXN's core business and valuation.It is a solid,long term investment.Don't be caught up in the cyclical gyrations of the semi-conductor industry.
Hodges likes the stock here.It still trades at only 12 times earnings.In general,they think the stock looks very attractive.TXN's outlook sounds pretty positive.Hodges thinks lead times and inventory levels will revert back to normal levels.
Analog is now over 90% of TXN's business,and will be the growth-driver in 2011-12.
Investors over the next couple of years will do very well with TXN.Hodges would be committing new capital to it at this point.
TXN's business outside the U.S. is more and more important for them.They have new opportunities in industrial applications,such as automotive,medical and all types of different industries through their analog chips.
Texas Instruments(TXN)

Analyst:Texas Instruments Looking Good

Texas Instruments is in a great position right now,according to Patrick Wang of Wedbush Morgan Securities.It has bought manufacturing capacity at a bargain level.It's interested in continuing a small acquisition strategy with its 2.3 billion in cash.
Mr.Wang doesn't see TXN levering up its balance sheet.They've added 4.5 billion in extra capacity in the last year.They bought it at pennies on the dollar.It's a buffer for the electronics firm against a double dip recession or slowing market trends,in Mr.Wang's opinion.
Texas Instruments(TXN)

Why Intel Did Better

Intel's chips are used in 80% of the world's computers.Its Q2 results show that people and companies are investing in technology,Chief Financial Officer Stacy Smith says.The enterprise market came back.They saw server and notebook sales strong.The IP network centers invested in posting information in the cloud.
Intel sees tablets as being a complimentary market.They saw nice growth in netbook sales and great growth in notebook.They think they're gonna be very well represented in tablets.
Intel's success is a combination of the strength of their product lines and their hard work to reduce their expenses.They're still really excited about the investment they're making in China.They saw that China over Q2 was a little stronger than normal seasonal patterns by the end of the quarter.China will be Intel's largest market in the world,Mr.Smith predicted.
Another tech titan,IBM,posted earnings per share that were greater than estimates,but,unlike Intel,reported revenue that missed the estimates of Wall Street analysts.Texas Instruments followed suit.
Intel(INTC),International Business Machines(IBM),Texas Instruments(TXN)