Using the PEG framework with analyst consensus forward EPS growth of 19.5% plus 2.8% dividend yield, Texas Instruments Incorporated has a fair value of $125.15 based on NTM EPS (FY2026) of $6.43. The current PEG ratio is 1.56.
PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.
PEG is most informative for high-growth companies — the PEG sweet spot.
| EPS Growth RateForward | 16.7% |
| Dividend Yield | +2.8% |
| Adjusted Growth (clamped 8–25%) | 19.5% |
| Fair P/E | 19.5x |
| NTM EPS (FY2026) | $6.43 |
| Fair Value | $125.15 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2025 (actual) | $5.45 | — | — |
| FY2026E | $6.43 | +17.9% | 25 |
| FY2027E | $7.66 | +19.2% | 26 |
| FY2028E | $8.99 | +17.4% | 17 |
| FY2029E | $11.53 | +28.3% | 14 |
| FY2030E | $11.78 | +2.2% | 8 |
5Y Forward EPS CAGR: 16.7%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2021 | $7.8B | $8.27 | — |
| FY2022 | $8.7B | $9.41 | +13.8% |
| FY2023 | $6.5B | $7.07 | -24.9% |
| FY2024 | $4.8B | $5.20 | -26.4% |
| FY2025 | $5.0B | $5.45 | +4.8% |
4Y Historical EPS CAGR: -9.9%
The PEG Fair Value uses the Price/Earnings-to-Growth framework. A stock is fairly valued when its P/E ratio equals its earnings growth rate (PEG = 1.0). This model adds dividend yield to the growth rate per the original PEGY formula.
Growth rate priority: analyst consensus forward EPS CAGR (when ≥ 3 analysts cover the stock), falling back to historical EPS CAGR. Using EPS rather than net income avoids distortion from share buybacks. The growth rate is clamped between 8% and 25% — below 8% would undervalue stable earners, while above 25% would overvalue unsustainable spikes.