Wedbush Morgan Raises Texas Instruments Outlook

Analyst David Wu cites strong semiconductor demand and increased ordering for the chipmaker

Wedbush Morgan raisesd its estimates on Texas Instruments (TXN ), and reiterates buy.

Analyst David Wu says data points since the second-quarter results in July suggest: 1) overall semiconductor demand has been unseasonably strong, especially in consumer electronics and PCs; 2) major cell-phone handset original equipment manufaturers are ordering components for major a step-up in the second-half build schedule.

Wu now sees TI posting 10 cents pro forma third quarter earnings per share, at the top end of guidance, vs. the 8 cents earnings per share consensus. He upped the 2003 estimate of 33 cents earnings per share on $9.5 billion revenue, to 36 cents earnings per share on $9.55 billion revenue.

Also, Wu raised the 2004 estimate of 80 cents earnings per share to 95 cents on the same revenue estimate of $11.56 billion, based on better gross margin assumptions. He also raised the $25 target to $30.

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