Should You Buy Texas Instruments Stock Despite Its Premium Valuation?

Texas Instruments (TXN) trades at a premium valuation of 26.97x forward P/E compared to the sector average of 20.22x, but the article argues this is justified. The company delivered strong Q2'26 results with 23% revenue growth and 52% EPS growth, while data center revenues doubled year-over-year. TXN benefits from AI infrastructure buildout through analog and embedded chips, plans to internalize 95% of wafer production by 2030, and generates substantial free cash flow. The company holds a Zacks Rank #2 (Buy) rating.