Although previous ceo steve jobs had opposed from

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demand typically remains high. Although previous CEO Steve Jobs had opposed from ever issuing dividends, as he felt that it was an impure method of financially handling money, current successor Tim Cook had announced that the company would start paying dividends by the summer (“Apple to Pay Dividend”). This news had radically impacted investors, as people have long anticipated on owning a part of the company for a while. Within the technology industry, the team chose to invest a substantial amount into Texas Instruments Inc. (TXN). Unfortunately, it was the worst performing stock within the portfolio, but the managers viewed it as a long-term investment. Our long-term investment outlook on TXN can be shown with its price/earnings to growth ratio (5 year expected); TXN is ranked number 2 within its industry segment, with a ratio of 2.12. Another enticing ratio was its dividend yield of 2.2%; despite TXN’s poor performance thus far, the company still managed to payout a dividend of .17 on April 26th. Another strength TXN holds is its market capitalization; TXN ranks fourth, showing a market capitalization of $35.3 billion. With such a strong position in the industry, our team viewed this investment as a safe bet. TXN's product portfolio includes products that are integral to almost all electronic equipment. It offers either custom or standard products. We viewed this as a strength for TXN because it could cater to all types of customers. For instance, TXN has partnered with a few companies, namely: Amazon, Research In Motion, and Apple, giving it a competitive advantage in the market. According to S&P Net Advantage, “gross margins widened from the 30% area several years ago to 49% in 2011 as TXN focused on higher-margin businesses and efficiently managed internal capacity.” In addition, the company has focused on its efficiency and has successfully lowered its operating expenses as a percentage of sales. Its operating margin is one of the best in the industry, widening from “single digits to the low 20% range over the past decade” ("Texas Instruments”). Although TXN had to reduce its inventory because of demand from customers, the company is expecting resurgence from customers in the coming quarters, key to a second half rebound! While most chipmakers have had to experience lower sequential sales recently, we see sequential growth resuming. An inventory rebuild in 2012 is partly supported by the adoption of Ultrabooks and the anticipated Windows 8 release later this year, representing an enormous upgrade opportunity for PC vendors around the touch interface. Net Advantage, for the semiconductor industry, estimates “improved economic conditions to lead to 3% growth in 2012 and forecasts mid-single digit growth in 2013.” Net Advantage sees “higher enterprise spending, improved consumer spending, rising Internet usage, expansion of wireless communication, and the proliferation of semiconductors across a range of electronic products and markets driving chip demand.” Although TXN didn’t perform as well as we hoped for these past couple of months (with a loss off $575,200), the company
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