Providing a New Semiconductor Play and Four More Double-Digit Gainers

Nicholas Vardy

Nicholas Vardy has a unique background that has proven his knack for making money in different markets around the world.

This week’s Alpha Algorithm identified a tech name with a storied past: Texas Instruments Inc. (TXN).

Headquartered in Dallas, Texas, Texas Instruments is one of the top 10 semiconductor companies worldwide. It is also one of the world’s leading designers and suppliers of digital signal processors and analog integrated circuits. After acquiring National Semiconductor in 2011, the company became the world’s largest maker of analog technology components.

TXN 2-9

Texas Instruments Inc. (TXN) vs. the S&P 500 over one year.

9 Top Investment Strategies Betting on Texas Instruments Inc. (TXN)

  1. Large-Cap Growth

The stock is among the top 50 large-capitalization U.S. growth stocks generated through a rigorous 10-factor fundamental screening process.

  1. Momentum Factor

The stock is one of the top 120 large- and mid-cap U.S. stocks exhibiting relatively higher price momentum, as measured by a specific factor which has historically driven a significant part of companies’ risk and return.

  1. Large-Cap Momentum

The stock is part of a major hedge fund’s systematic strategy that invests in large- and mid-cap U.S. companies with positive momentum and that rank in the top third of total return over the prior 12 months, excluding the last month.

  1. Goldman Sachs’ Active Beta

The stock is selected according to four factors — value, quality, momentum and low volatility. These, in turn, are based on criteria including book value, sales and cash flow scaled by share price, profit/assets or return on equity (ROE), risk-adjusted returns and daily standard deviation of returns.

  1. Shareholder Yield

TXN is one of the companies (a) paying cash dividends, (b) engaging in net share repurchases and (c) paying down balance-sheet debt.

  1. Float Shrink

Companies that shrink their float while growing free cash flow and not increasing their leverage.

  1. High-Quality Stock

The stock exhibits positive fundamentals, including high return on equity, stable year-over-year earnings growth and low financial leverage.

  1. Capital Strength

The stock is part of a strategy that seeks to outperform the market by selecting companies based on the strength of their balance sheets, long-term debt ratios and return on assets (ROA).

  1. Hedge Fund Alpha

Based on publicly available disclosures, successful hedge fund managers are investing in the stock.

Exclusive  A New Breed: Income-Driven Dividend Funds

Recommendation

Buy Texas Instruments Inc.(TXN) at market today, and place your stop at $71.00.

If you want to play the options, I recommend the April $75.00 calls (TXN170421C00075000), which last traded at $3.20 and expire on April 21.

Portfolio Update

Raise your stop in Altria Group (MO) to $71.05 to lock in double-digit-percentage gain in the stock.

Raise your stop in Apple (AAPL) to $130.80 to lock in a double-digit-percentage gain as well.

Raise your stop in Facebook (FB) to $133.00 to lock in a 15% gain in the stock.

Your position in Home Depot (HD) also now boasts a 10.35% gain.

Click here to view the Portfolio Update table.

Sincerely,

Nicholas Vardy

Nicholas A. Vardy

VAA chart 2-9 (2)

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⇐ Part 4 (#9 to #12) This article features four option spread strategies and is part of an eight-story series that continues from a previous article. This write

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