Comprehensive Stock Comparison
Compare Microchip Technology Incorporated (MCHP) vs Texas Instruments Incorporated (TXN) Stock
Analyze side-by-side fundamentals, valuation, growth, and profitability to decide which stock is the better buy.
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Quick Verdict
| Category | Winner | Why |
|---|---|---|
| Growth | TXN | 13.0% revenue growth vs MCHP's -42.3% |
| Value | TXN | Lower P/E (33.0x vs 47.6x) |
| Quality / Margins | TXN | 28.3% net margin vs MCHP's -2.2% |
| Stability / Safety | TXN | Beta 1.29 vs MCHP's 2.17 |
| Dividends | TXN | 2.6% yield, 22-year raise streak, vs MCHP's 2.4% |
| Momentum (1Y) | MCHP | +29.9% vs TXN's +11.1% |
| Efficiency (ROA) | TXN | 14.5% ROA vs MCHP's -0.7%, ROIC 16.6% vs 1.8% |
Who Each Stock Is For
Income & stability
Growth exposure
Long-term compounding (10Y)
Sleep-well-at-night portfolio
Defensive / Recession hedge
Business Model
What each company does and how it makes money
Microchip Technology is a semiconductor company that designs and manufactures microcontrollers, analog chips, and other embedded control solutions for industrial, automotive, and consumer applications. It generates revenue primarily through microcontroller sales (~50% of revenue) and analog/power management chips (~30%), with the remainder from memory, FPGA, and development tools. The company's moat lies in its extensive catalog of over 100,000 products and deep customer relationships in mission-critical embedded systems where reliability and long-term availability are paramount.
Texas Instruments is a semiconductor company that designs and manufactures analog and embedded processing chips for industrial, automotive, and consumer electronics applications. It generates revenue primarily from analog chips (~75% of sales) and embedded processors (~25%), selling directly to electronics manufacturers across multiple industries. The company's competitive advantage stems from its deep expertise in analog technology—which is difficult to replicate—and its efficient manufacturing scale through its own fabrication facilities.
Revenue Breakdown by Segment
How each company's revenue is distributed across its business units
Financial Metrics Comparison
Side-by-side fundamentals across 2 stocks. BestLagging
Financial Scorecard
TXN leads in 4 of 6 categories (Profitability & Efficiency, Total Returns). MCHP leads in 1 (Valuation Metrics). 1 tied.
Financial Metrics (TTM)
TXN is the larger business by revenue, generating $17.7B annually — 4.0x MCHP's $4.4B. TXN is the more profitable business, keeping 28.3% of every revenue dollar as net income compared to MCHP's -2.2%. On growth, MCHP holds the edge at +15.6% YoY revenue growth, suggesting stronger near-term business momentum.
| Metric | MCHPMicrochip Technol… | TXNTexas Instruments… |
|---|---|---|
| RevenueTrailing 12 months | $4.4B | $17.7B |
| EBITDAEarnings before interest/tax | $881M | $8.0B |
| Net IncomeAfter-tax profit | -$97M | $5.0B |
| Free Cash FlowCash after capex | $820M | $2.6B |
| Gross MarginGross profit ÷ Revenue | +51.6% | +57.0% |
| Operating MarginEBIT ÷ Revenue | +4.1% | +34.1% |
| Net MarginNet income ÷ Revenue | -2.2% | +28.3% |
| FCF MarginFCF ÷ Revenue | +18.8% | +14.7% |
| Rev. Growth (YoY)Latest quarter vs prior year | +15.6% | +10.4% |
| EPS Growth (YoY)Latest quarter vs prior year | +160.2% | -1.5% |
Valuation Metrics
On an enterprise value basis, TXN's 25.3x EV/EBITDA is more attractive than MCHP's 43.1x.
| Metric | MCHPMicrochip Technol… | TXNTexas Instruments… |
|---|---|---|
| Market CapShares × price | $40.2B | $192.5B |
| Enterprise ValueMkt cap + debt − cash | $45.1B | $203.3B |
| Trailing P/EPrice ÷ TTM EPS | -9999.00x | 38.92x |
| Forward P/EPrice ÷ next-FY EPS est. | 47.63x | 33.02x |
| PEG RatioP/E ÷ EPS growth rate | — | — |
| EV / EBITDAEnterprise value multiple | 43.10x | 25.35x |
| Price / SalesMarket cap ÷ Revenue | 9.14x | 10.89x |
| Price / BookPrice ÷ Book value/share | 5.67x | 11.90x |
| Price / FCFMarket cap ÷ FCF | 52.08x | 73.95x |
Profitability & Efficiency
TXN delivers a 30.7% return on equity — every $100 of shareholder capital generates $31 in annual profit, vs $-1 for MCHP. MCHP carries lower financial leverage with a 0.80x debt-to-equity ratio, signaling a more conservative balance sheet compared to TXN's 0.86x. On the Piotroski fundamental quality scale (0–9), TXN scores 7/9 vs MCHP's 5/9, reflecting strong financial health.
| Metric | MCHPMicrochip Technol… | TXNTexas Instruments… |
|---|---|---|
| ROE (TTM)Return on equity | -1.5% | +30.7% |
| ROA (TTM)Return on assets | -0.7% | +14.5% |
| ROICReturn on invested capital | +1.8% | +16.6% |
| ROCEReturn on capital employed | +2.1% | +19.0% |
| Piotroski ScoreFundamental quality 0–9 | 5 | 7 |
| Debt / EquityFinancial leverage | 0.80x | 0.86x |
| Net DebtTotal debt minus cash | $4.9B | $10.8B |
| Cash & Equiv.Liquid assets | $772M | $3.2B |
| Total DebtShort + long-term debt | $5.7B | $14.0B |
| Interest CoverageEBIT ÷ Interest expense | 0.78x | 11.52x |
Total Returns (with DRIP)
A $10,000 investment in TXN five years ago would be worth $13,350 today (with dividends reinvested), compared to $10,390 for MCHP. Over the past 12 months, MCHP leads with a +29.9% total return vs TXN's +11.1%. The 3-year compound annual growth rate (CAGR) favors TXN at 10.0% vs MCHP's -0.4% — a key indicator of consistent wealth creation.
| Metric | MCHPMicrochip Technol… | TXNTexas Instruments… |
|---|---|---|
| YTD ReturnYear-to-date | +15.5% | +20.3% |
| 1-Year ReturnPast 12 months | +29.9% | +11.1% |
| 3-Year ReturnCumulative with dividends | -1.3% | +33.0% |
| 5-Year ReturnCumulative with dividends | +3.9% | +33.5% |
| 10-Year ReturnCumulative with dividends | +285.6% | +373.7% |
| CAGR (3Y)Annualised 3-year return | -0.4% | +10.0% |
Risk & Volatility
TXN is the less volatile stock with a 1.29 beta — it tends to amplify market swings less than MCHP's 2.17 beta. A beta below 1.0 means the stock typically moves less than the S&P 500.
| Metric | MCHPMicrochip Technol… | TXNTexas Instruments… |
|---|---|---|
| Beta (5Y)Sensitivity to S&P 500 | 2.17x | 1.29x |
| 52-Week HighHighest price in past year | $83.35 | $231.32 |
| 52-Week LowLowest price in past year | $34.13 | $139.95 |
| % of 52W HighCurrent price vs 52-week peak | +89.6% | +91.7% |
| RSI (14)Momentum oscillator 0–100 | 47.1 | 49.7 |
| Avg Volume (50D)Average daily shares traded | 7.6M | 6.7M |
Analyst Outlook
Wall Street rates MCHP as "Buy" and TXN as "Buy". Consensus price targets imply 16.6% upside for MCHP (target: $87) vs -0.2% for TXN (target: $212). For income investors, TXN offers the higher dividend yield at 2.58% vs MCHP's 2.43%.
| Metric | MCHPMicrochip Technol… | TXNTexas Instruments… |
|---|---|---|
| Analyst RatingConsensus buy/hold/sell | Buy | Buy |
| Price TargetConsensus 12-month target | $87.00 | $211.79 |
| # AnalystsCovering analysts | 46 | 65 |
| Dividend YieldAnnual dividend ÷ price | +2.4% | +2.6% |
| Dividend StreakConsecutive years of raises | 5 | 22 |
| Dividend / ShareAnnual DPS | $1.82 | $5.48 |
| Buyback YieldShare repurchases ÷ mkt cap | +0.2% | +0.8% |
Historical Charts
Charts are rendered on first load. Hover for details.
Chart 1Total Return — 5 Years (Rebased to 100)
| Stock | Mar 20 | Feb 26 | Change |
|---|---|---|---|
| Microchip Technolog… (MCHP) | 100 | 164 | +64.0% |
| Texas Instruments I… (TXN) | 100 | 189.13 | +89.1% |
Texas Instruments I… (TXN) returned +34% over 5 years vs Microchip Technolog… (MCHP)'s +4%. A $10,000 investment in TXN 5 years ago would be worth $13,350 today (including dividends reinvested).
Chart 2Revenue Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Microchip Technolog… (MCHP) | $2.2B | $4.4B | +102.5% |
| Texas Instruments I… (TXN) | $13.4B | $17.7B | +32.3% |
Microchip Technology Incorporated's revenue grew from $2.2B (2016) to $4.4B (2025) — a 8.2% CAGR. Texas Instruments Incorporated's revenue grew from $13.4B (2016) to $17.7B (2025) — a 3.2% CAGR.
Chart 3Net Margin Trend — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Microchip Technolog… (MCHP) | 14.9% | -0.0% | -100.1% |
| Texas Instruments I… (TXN) | 26.9% | 28.3% | +5.2% |
Microchip Technology Incorporated's net margin went from 15% (2016) to -0% (2025). Texas Instruments Incorporated's net margin went from 27% (2016) to 28% (2025).
Chart 4P/E Ratio History — 9 Years
| Stock | 2017 | 2025 | Change |
|---|---|---|---|
| Microchip Technolog… (MCHP) | 122.1 | 16.5 | -86.5% |
| Texas Instruments I… (TXN) | 28.9 | 31.8 | +10.0% |
Microchip Technology Incorporated has traded in a 17x–134x P/E range over 8 years; current trailing P/E is ~-9999x. Texas Instruments Incorporated has traded in a 17x–36x P/E range over 9 years; current trailing P/E is ~39x.
Chart 5EPS Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Microchip Technolog… (MCHP) | 0.75 | -0.01 | -100.7% |
| Texas Instruments I… (TXN) | 3.48 | 5.45 | +56.6% |
Microchip Technology Incorporated's EPS grew from $0.75 (2016) to $-0.01 (2025) — a NaN% CAGR. Texas Instruments Incorporated's EPS grew from $3.48 (2016) to $5.45 (2025) — a 5% CAGR.
Chart 6Free Cash Flow — 5 Years
Microchip Technology Incorporated generated $772M FCF in 2025 (-58% vs 2021). Texas Instruments Incorporated generated $3B FCF in 2025 (-59% vs 2021).
MCHP vs TXN: Frequently Asked Questions
9 questions · data-driven answers · updated daily
01Is MCHP or TXN a better buy right now?
Texas Instruments Incorporated (TXN) offers the better valuation at 38.9x trailing P/E (33.0x forward), making it the more compelling value choice. Analysts rate Microchip Technology Incorporated (MCHP) a "Buy" — based on 46 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.
02Which has the better valuation — MCHP or TXN?
On forward P/E, Texas Instruments Incorporated is actually cheaper at 33.0x.
03Which is the better long-term investment — MCHP or TXN?
Over the past 5 years, Texas Instruments Incorporated (TXN) delivered a total return of +33.5%, compared to +3.9% for Microchip Technology Incorporated (MCHP). A $10,000 investment in TXN five years ago would be worth approximately $13K today (assuming dividends reinvested). Over 10 years, the gap is even starker: TXN returned +373.7% versus MCHP's +285.6%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.
04Which is safer — MCHP or TXN?
By beta (market sensitivity over 5 years), Texas Instruments Incorporated (TXN) is the lower-risk stock at 1.29β versus Microchip Technology Incorporated's 2.17β — meaning MCHP is approximately 67% more volatile than TXN relative to the S&P 500. On balance sheet safety, Microchip Technology Incorporated (MCHP) carries a lower debt/equity ratio of 80% versus 86% for Texas Instruments Incorporated — giving it more financial flexibility in a downturn.
05Which has better profit margins — MCHP or TXN?
Texas Instruments Incorporated (TXN) is the more profitable company, earning 28.3% net margin versus -0.0% for Microchip Technology Incorporated — meaning it keeps 28.3% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: TXN leads at 34.1% versus 6.7% for MCHP. At the gross margin level — before operating expenses — TXN leads at 57.0%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.
06Is MCHP or TXN more undervalued right now?
On forward earnings alone, Texas Instruments Incorporated (TXN) trades at 33.0x forward P/E versus 47.6x for Microchip Technology Incorporated — 14.6x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for MCHP: 16.6% to $87.00.
07Which pays a better dividend — MCHP or TXN?
All stocks in this comparison pay dividends. Texas Instruments Incorporated (TXN) offers the highest yield at 2.6%, versus 2.4% for Microchip Technology Incorporated (MCHP).
08Is MCHP or TXN better for a retirement portfolio?
For long-horizon retirement investors, Texas Instruments Incorporated (TXN) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 1.29), 2.6% yield, +373.7% 10Y return). Microchip Technology Incorporated (MCHP) carries a higher beta of 2.17 — meaning larger drawdowns in market downturns, which matters significantly when you cannot wait years for a recovery. Both have compounded well over 10 years (TXN: +373.7%, MCHP: +285.6%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.
09What are the main differences between MCHP and TXN?
Both stocks operate in the Technology sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.
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