Despite a slight increase in the stock market in 2024, shares of companies supplying components for Apple, such as Jabil, a manufacturer of enclosures, and Texas Instruments, a semiconductor supplier, continue to attract investor interest.
When it comes to Texas Instruments’ (TXN) stock, we have seen minor changes since January 2021, when its value was around $165. Currently, it hovers around $160. While the S&P 500 index has increased by about 35% during these three years, TXN shares have remained at a relatively low level. In 2021, they only saw a 15% increase, followed by a 12% decline in 2022, and a 3% increase in 2023. In comparison, the S&P 500 index achieved growth rates of 27%, -19%, and 24% in the same years, respectively. It is evident that TXN shares performed worse than the S&P 500 index in 2021 and 2023.
Regardless of the sector, it has been challenging to find companies that consistently outperform the S&P 500 index in recent years. Even powerful entities like Microsoft, Apple, and Nvidia have struggled to surpass this benchmark, as have tech giants Google, Tesla, and Amazon. An exception is the Trefis High Quality Portfolio, which has achieved better results than the S&P 500 index during the same period. How can we explain this difference? The companies within the HQ Portfolio have achieved better returns with lower risk, as confirmed by relevant indicators.
Considering the uncertain macroeconomic situation, with high oil prices and increased interest rates, how will Texas Instruments and other component suppliers for Apple cope?
Apple recorded mixed sales results in the first quarter of the 2023 fiscal year. While overall revenues increased by 2% year-over-year, reaching $119.6 billion, there has been a slowdown in iPad and wearables sales. On the other hand, iPhone sales and services have experienced growth, helping to maintain relatively high margins. The average selling price of iPhones was around $988, but it has slightly decreased in the following two quarters. The releases of the latest iPhone 15 model, including the more expensive Pro Max variant, are expected in the coming months, which may contribute to an increase in the average iPhone prices. Consequently, component suppliers can expect more favorable negotiation conditions with Apple. Another factor that will improve suppliers’ margins is the gradual easing of supply chain issues resulting from the pandemic.
In conclusion, the future of component manufacturers for Apple largely depends on the sales outlook of this tech giant. Despite market changes, investors are seeking opportunities to achieve better results than stock indices.
FAQ:
1. What are the current results of Texas Instruments (TXN) stock?
Currently, the value of TXN shares is around $160.
2. What results did TXN achieve in recent years?
In 2021, TXN shares increased by 15%, decreased by 12% in 2022, and increased by 3% in 2023.
3. How do the results of TXN stock compare to the S&P 500 index?
Compared to the S&P 500 index, TXN shares performed worse in 2021 and 2023.
4. Which companies have outperformed the S&P 500 index in recent years?
The Trefis High Quality Portfolio achieved better results than the S&P 500 index during the same period.
5. Which factors may impact the future of component manufacturers for Apple?
The sales outlook of Apple and the gradual resolution of supply chain issues resulting from the pandemic can influence the future of these companies.
Definitions:
1. Stock market – a place where buying and selling of stocks and other securities takes place.
2. Stocks – shares of a company that can be bought or sold on the stock market.
3. S&P 500 index – an index that measures changes in the value of the 500 largest US companies.
4. Company – an organization with a separate legal entity.
5. Components – parts or elements that are part of a larger device or system.
6. Semiconductor components – electronic parts made of semiconductors, such as transistors or diodes.
Related Links:
– ti.com – Texas Instruments
– apple.com – Apple
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The source of the article is from the blog yanoticias.es