In this article, we discuss the top 5 semiconductor stock picks of Goldman Sachs. If you want to see more stocks in this selection, check out Goldman Sachs Semiconductor Stocks: Top 10 Picks.
5. Texas Instruments Incorporated (NASDAQ:TXN)
Number of Hedge Fund Holders: 55
Goldman Sachs’ Stake Value: $1,176,598,000
Texas Instruments Incorporated (NASDAQ:TXN) designs, manufactures, and sells semiconductors to electronics designers and manufacturers worldwide. It operates through two segments – Analog and Embedded Processing. On October 25, the company reported a Q3 GAAP EPS of $2.47 and a revenue of $5.24 billion, topping market estimates by $0.08 and $100 million, respectively.
Texas Instruments Incorporated (NASDAQ:TXN) is one of the top Goldman Sachs semiconductor stocks to monitor. The firm owns 7.65 million shares of Texas Instruments Incorporated (NASDAQ:TXN) worth $1.17 billion as of Q2 2022, representing 0.26% of the total holdings.
On October 26, Benchmark analyst Cody Acree maintained a Buy rating on Texas Instruments Incorporated (NASDAQ:TXN) but lowered the price target on the shares to $189 from $205 following the company’s Q3 earnings report. He was encouraged by the company’s Q3 revenue and earnings upside, and believes that the conservative Q4 guidance is “prudent and generally as expected by much of the Street.”
According to Insider Monkey’s data, 55 hedge funds were bullish on Texas Instruments Incorporated (NASDAQ:TXN) at the end of Q2 2022, compared to 46 funds in the last quarter. Jean-Marie Eveillard’s First Eagle Investment Management is the leading position holder in the company, with 3.5 million shares worth $542 million.
Here is what Davis Opportunity Fund has to say about Texas Instruments Incorporated (NASDAQ:TXN) in its Q4 2021 investor letter:
“Within technology and communication services, we own a number of online businesses and semiconductor related companies, including Alphabet, Amazon, Intel, Applied Materials and Texas Instruments. Within the realm of high technology, we believe that leadership positions reflect enduring and widening competitive advantages over smaller competitors, with few exceptions. This is because online businesses, as well as semiconductor companies, benefit from economies of scale. An online search and advertising engine will, in general, be more profitable per unit of cost as it grows larger in terms of users and advertising dollars. It is a hub-and-spoke model, in other words, where it is generally not necessary to grow expenses at the same rate that revenues grow beyond a certain threshold. Therefore, returns on capital tend to be higher, the larger and more dominant the online search company is.”
