Topic: How To Invest

Invest in stocks: Japanese earthquake weighs on Texas Instruments’ earnings

Texas Instruments Inc., symbol TXN on New York, is shifting its focus from digital chips for cellphones to faster-growing analog chips, which convert sound and images into digital signals that computers can understand.

We analyze Texas Instruments in Wall Street Stock Forecaster, our newsletter that recommends companies for investors who invest in stocks in the U.S. markets.

Revenue and earnings declined in the 2011 second quarter compared with a year earlier. This was mainly due to the disruption caused by the Japanese earthquake/tsunami in March. The earthquake reduced production at the company’s Japanese factories, and cost it $50 million to repair the damage.

As a result, revenue in the quarter fell 1.1%, to $3.46 billion from $3.5 billion. Earnings fell 12.6%, to $672 million from $769 million. Earnings per share fell 9.7%, to $0.56 from $0.62, on fewer shares outstanding.

The company still plans to buy rival analog chipmaker National Semiconductor Corp. (New York symbol NSM) for $6.5 billion in cash. The deal should close by the end of 2011. The latest quarterly earnings included $13 million of costs related to this purchase. Texas Instruments recently borrowed $4.7 billion to help pay for this acquisition.

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