Texas Instruments Investor Presentation — November 2019

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Prepared by WhiteField Capital:

Vishwamithra Shashishekara

21 November 2019(TXN)0123456789Proprietary ScoresBased on our WhiteField Score and other filters, Texas Instruments shows promise

High Leverage𝐖𝐡𝐢𝐭𝐞𝐅𝐢𝐞𝐥𝐝 𝐒𝐜𝐨𝐫𝐞

=3∗𝑅𝑜𝑇𝐶𝐸∗𝑂𝑝𝑒𝑟𝑎𝑡𝑖𝑛𝑔 𝐶𝑎𝑠ℎ𝐹𝑙𝑜𝑤

𝐸𝐵𝐼𝑇𝐷𝐴+2∗𝐸𝐵𝐼𝑇𝐷𝐴 𝑀𝑎𝑟𝑔𝑖𝑛

This rejected or de -prioritized the top 13 WhiteField Scores*This formula is based on 10 year averages

𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑇𝑎𝑛𝑔𝑖𝑏𝑙𝑒 𝐶𝑎𝑝𝑖𝑡𝑎𝑙𝐸𝑚𝑝𝑙𝑜𝑦𝑒𝑑

Decision: Select TEXAS INSTRUMENTS for further analysisBusiness Quality

across firms in different

good businesses •Efficient businesses

flow/EBITDA is a good

measure of operating

cash flow conversionCash Flow

pricing power and/or

good cost management

efficient qualityStable, High MarginsRank companies

WhiteField ScoreReject if

declineReject if high

𝐶𝑎𝑝𝑖𝑡𝑎𝑙>1.5De-prioritize if

𝐸𝑎𝑟𝑛𝑖𝑛𝑔𝑠>25,

indicating low margin

Source: Capital IQ100%91%81%65%47%26%20%5%

<0%[0%,5%)[5%,10%)[10%,15%)[15%,20%)[20%,22.7%)[22.7%,30%)>=30%US Return on Capital Percentiles

•TXN is in top 3%ile

02,0004,0006,0008,00010,00012,000Aggregate Peer Group EBIT Margins

Aggregate EBIT Aggregate EBIT margin

Good cyclical average revenue

Though with 53% more revenues,

TXN has grown 37% slower than

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