CORPORATESISSUER COMMENT 4 MAY 2015TEXAS INSTRUMENTS, INC. (TXN)Moodys Senior Unsecured Rating A1Moodys Outlook POSBond-Implied Rating Aa1CDS-Implied Rating A2EDF-Implied Rating AaaAs of 04/30/2015ANALYST CONTACTSAllerton G. Smith 212-553-4058 Sr Dir-Sr Research Analyst allerton.smith@moodys.comABOUT CAPITAL MARKETS RESEARCHAnalyses from Moodys Capital Markets Research, Inc. (CMR) focus on explaining signals from the credit and equity markets. The publications address whether market signals, in the opinion of the groups analysts, accurately reflect the risks and investment opportunities associated with issuers and sectors. CMR research thus complements the fundamentally-oriented research offered by Moodys Investors Service (MIS), the rating agency.CMR is part of Moodys Analytics, which is one of the two operating businesses of Moodys Corporation. Moodys Analytics (including CMR) is legally and organizationally separated from Moodys Investors Service and operates on an arms length basis from the ratings business. CMR does not provide investment advisory services or products.View the CMR FAQ Contact the CMR team Follow us on TwitterMoodys Analytics markets and distributes all Moodys Capital Markets Research, Inc. materials. Moodys Capital Markets Research, Inc. is a subsidiary of Moodys Corporation. Moodys Analytics does not provide investment advisory services or products. For further detail, please see the last page.Market Signals ReviewTexas Instruments: One Market Signal Advances, Others Steady Over the last three months the bond-implied rating for Texas Instruments moved up three notches from A1 to Aa1. The CDS-implied rating of A2 and the EDF'-implied rating of Aaa did not change (Figure 1).FIGURE 1. TEXAS INSTRUMENTS: MOODYS AND MARKET-IMPLIED RATINGS, LAST 90 DAYS (DAILY DATA)The companys bond-implied rating has been the most volatile of its three implied-ratings. Over the last 12 months it fluctuated from a high of Aa1 to a low of A2.The EDF-implied rating has been Aaa since February 2014. Its five-year low point of A2 was last observed in April of 2013.MOODY'S ANALYTICS CORPORATES2 4 MAY 2015 MARKET SIGNALS REVIEW : TEXAS INSTRUMENTS: ONE MARKET SIGNAL ADVANCES, OTHERS STEADYThe CDS contract for Texas Instruments is somewhat illiquid, and we do not get CDS trading levels every day. Over the last 12 months, the CDS-implied rating for Texas Instruments has varied from Aa3 to A2; however, we would rely less on this market signal due to its erratic availability.According to our ratings gap-conditioned transition matrices, companies rated A1 with a bond-implied rating of Aa1 outperformed the broad market 12% of the time over the following 12 months, matched the markets performance 26% of the time, and underperformed the broad market 52% of the time.Readers will recall that when a market-implied rating rises, the underlying securities have outperformed the broad market; such is the case ...
