Texas Instruments shares slip after chip maker’s 1st-quarter update
By APTuesday, March 9, 2010
Texas Instruments shares slip after 1Q update
NEW YORK — Shares of Texas Instruments Inc. slipped Tuesday as investors gave the chip maker’s latest financial projections a cool reception.
After the close Monday, Dallas-based TI raised the low end of its first-quarter earnings and sales estimates. But shares fell 68 cents, or 2.8 percent, to $24.01 in morning trading.
In a client note, Jefferies & Co. analyst Adam Benjamin said it was likely investors had already anticipated that TI would hike its forecast, given recent comments from other companies in the semiconductor industry.
Caris & Co.’s Craig Ellis, who rates the stock “Average,” pointed out that TI’s profit margin remains flat at best, which he blamed on an unfavorable mix of high and low-margin product sales and rising labor costs, among other factors.
TI said it now expects a profit of 48 cents to 52 cents per share and revenue of $3.07 billion to $3.19 billion. That’s up from a previous forecast of 44 cents to 52 cents per share and revenue of $2.95 billion to $3.19 billion.
