Texas Instruments heads into its July 20 Q2 earnings report with a striking disconnect: the stock has sold off sharply, yet almost every other signal points toward bullish conviction rather than fear.
The price action has been brutal. TXN has dropped nearly 9% on the week to $284.02 and is down 7% over the past month. The weakness is TXN-specific, not just sector noise. Close peers MCHP and ON fell a similar 8-9% on the week, but ADI lost only 5% and MPWR shed just 3% — suggesting investors are applying an extra discount to TXN ahead of the print. The last comparable earnings event, in April, produced a 21% single-day gain and a 15% five-day follow-through. That kind of outcome is clearly not priced into current levels.
The positioning picture flatly contradicts the price weakness. Short interest has fallen 18% on the week to just 1.85% of the free float — shorts are covering, not pressing. The ORTEX short score has also eased, dropping from around 31.5 at the start of July to 30.1 now, confirming the bearish community is stepping back rather than adding. Borrow conditions give no ammunition to the other side either: availability is essentially unconstrained with nearly a billion shares available to lend, and cost to borrow — while it has risen sharply in percentage terms — sits at just 0.47%, an almost rounding-error level in absolute terms. Options add another bullish data point: the put/call ratio has dropped to 0.72, almost two standard deviations below its 20-day average of 0.79, landing toward the most call-heavy reading of the past year. Taken together, the lending and options markets look more comfortable with TXN than the stock price implies.
The Street has been firmly in the bull camp and growing more so. Keybanc raised its target to $390 on July 14, keeping its Overweight. TD Cowen lifted to $360 on July 13, maintaining Buy. UBS and Stifel both moved targets higher at end of June, also holding Buy ratings. The consensus mean target is $303 — above the current price, though well below the more aggressive $390 prints. The bull case rests on TXN's dominant market share in analog chips and its exposure to power management and next-generation materials including SiC and GaN. Bears point to timing: meaningful revenue from data center deployment may not arrive until 2028, and near-term results remain hostage to industrial and automotive inventory cycles. The EV/EBITDA multiple has compressed by roughly 1.3 turns over the past month to 23.1x, and the P/E has eased to 33.3x — slightly cheaper than a month ago, though still demanding for a business still waiting on its upcycle. Factor scores give a nuanced read: the dividend score ranks in the 97th percentile, EPS surprise in the 72nd, and 90-day EPS momentum in the 73rd — quality and estimate revision trends are healthy. Near-term EPS momentum (30-day) is only in the 42nd percentile, reflecting a slower pace of upgrades recently.
JP Morgan Asset Management added roughly 7.5 million shares in the most recent reported quarter, making it one of the more active movers among the top holders. BlackRock and State Street both added modestly. The insider picture is less encouraging in isolation — the CFO sold roughly $15 million worth of stock in mid-May — but the trades were spread across multiple insiders including directors, and the net 90-day picture is affected by routine plan-driven activity rather than a single aggressive directional signal.
The Q2 report on July 20 is the event that resolves the week's tension: either the results validate the analyst conviction that has been building since spring, or the price action proves to have been the smarter signal.
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