As much as it seems to annoy some readers, I still think valuation matters - even when we're talking about some of the best-run companies out there. Back in April, I thought Texas Instruments' (TXN) valuation wasn't bad, but also wasn't good enough to call it a clear-cut buy. While TI has continued to execute well, the 20% or move in the share price since then (hardly bad, by the way) is lower than that from SOX, as well as from names I preferred like Broadcom (AVGO) and STMicroelectronics (STM).
The entire chip space has gotten more expensive since April, and bargains are harder to find. Near-term prospective returns don't look so exciting for TI now, but I don't know that I'd be in a big rush to sell out if I owned the shares as there could be additional beat-and-raises as major end-markets like autos and industrials recover.
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