Texas Instruments Eyes $281.75 If It Clears $278.72

Texas Instruments has been positioning itself to benefit from the AI infrastructure buildout without making GPUs. In the first quarter, the company started separating its data center revenue from other business lines, a move likely to continue as data center revenue grows. Inside servers and power infrastructure, numerous analog components create an opportunity for TI to gain revenue from the AI adoption cycle. This is part of a broader recovery: in the second quarter, revenue increased 23% to $5.46 billion and operating profit increased 48% compared with the second quarter of 2020, while net income rose 53% to $1.98 billion. Management noted positive trends in industrial, automotive, and data center businesses.

The company also has several firm-specific catalysts. On September 17, TI increased its dividend by 7% to $1.52, marking the 23rd consecutive year of dividend increases. Capital expenditures are expected to be significantly lower in 2026 and beyond after investments in 300mm manufacturing capacity funded in part by the CHIPS Act. The $7.5 billion purchase of Silicon Labs is expected by analysts to create $450 million in manufacturing and operational synergies, strengthening embedded wireless offerings. The main risk remains a potential inventory correction in the semiconductor market, particularly among industrial and automotive customers, which could trigger a digestion phase.

Should the technical breakout hold above $275.21, the stock could test the $281.75 and $284.67 targets. However, the RSI at 63 signals mild overbought conditions, leaving room for a pullback. The outcome for next week hinges on whether AI and data-center demand can sustain the recovery momentum and whether broader economic conditions remain supportive, as the analyst notes the market may be decoupling from the economy.