Aptiv PLC (APTV) vs Texas Instruments Incorporated (TXN): Which Is the Better Buy in 2026?
As of 2026-09-17, APTV is undervalued at $44, with a DCF intrinsic value of $166 and a margin of safety of 74%. TXN is undervalued at $261, with an intrinsic value of $365 and a margin of safety of 28%. Of the two, APTV has the wider margin of safety.
Rewards
- ★Free cash flow has grown at a 54.0% CAGR over the past 4 years, demonstrating strong earnings power growth.
- ★Share count has been reduced by 21% over the past 4 years through buybacks, increasing each share's claim on earnings.
- ★4 insider purchases totaling $8.3M with no sells in the past 3 months — insiders are putting their own money in.
- ★Texas Instruments Incorporated has maintained ROIC above 15% for 4 consecutive years, indicating a durable competitive advantage.
- ★Return on equity has consistently exceeded 20% over 4 years, indicating efficient use of shareholder capital.
- ★PEG ratio of 0.94 suggests the stock is undervalued relative to its growth rate — paying less than 1x for each unit of earnings growth.
Risks
- ⚠Gross margin of 19.3% is low, suggesting a competitive or commodity-like market with limited pricing power.
- ⚠Buybacks have been poorly timed — 3 out of 4 years involved repurchases at relatively expensive valuations.
- ⚠FCF yield of 1.5% is below 3%, meaning the market is pricing in substantial future growth to justify the current price.
- ⚠Trailing P/E of 39.7x is 47% above the historical average of 27.1x — the stock trades at a premium to its own history.
Key Valuation Metrics
Learn more →Historical Fundamentals
Learn more →Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
$1 Retained Earnings Test
Learn more →> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Discounted Cash Flow (DCF) Analysis
Learn more →Reverse DCF — Market-Implied Growth
Learn more →What growth rate is the market pricing in at $44?
The market implies +12.3% Owner Earnings growth, above historical trends.
Standard FCF implies a demanding -3.9%, reflecting heavy growth investment.
What growth rate is the market pricing in at $261?
The market implies +19.9% Owner Earnings growth, above historical trends.
Standard FCF implies a demanding +24.7%, reflecting heavy growth investment.
Economic Moat Score
Learn more →Narrow moat with reinvestment efficiency as the key competitive advantage. Improving roic consistency would strengthen the moat.
Narrow moat with roic consistency as the key competitive advantage. Improving reinvestment efficiency would strengthen the moat.
Forensic Accounting
Learn more →M-Score Trend
M-Score Trend
Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.
Ownership Breakdown
Learn more →High insider ownership aligns management incentives with shareholders. Institutional concentration can indicate smart-money conviction but also crowding risk.
Insider Buying Activity
Learn more →Open market purchases · includes direct & indirect ownership · excludes option exercises.
Insider Selling Activity
Learn more →Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives.
🎭 Mr. Market's Mood
Learn more →"Market is pessimistic — investigate whether fears are temporary or structural"
"Market is pricing this stock without strong emotion in either direction"
Composite sentiment score based on market signals. Inspired by Buffett’s "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.
⚖️ Buffett Signal
Learn more →The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
Frequently Asked Questions: APTV vs TXN
Is Aptiv PLC or Texas Instruments Incorporated more undervalued in 2026?▼
Based on our discounted cash flow model, APTV trades at a 73.7% margin of safety (intrinsic value $166 vs. price $44), compared to TXN's 28.5% margin of safety (intrinsic $365 vs. $261).
Which stock has a wider economic moat, Aptiv PLC or Texas Instruments Incorporated?▼
APTV scores 51/100 (Narrow moat), while TXN scores 48/100 (Narrow moat). The moat score measures competitive advantage durability across ROIC consistency, margin stability, revenue predictability, and reinvestment efficiency.
Is Aptiv PLC in financial distress?▼
APTV's Altman Z-Score of 2.4 places it in the Grey zone, signaling elevated bankruptcy risk. TXN scores 8.7 (Safe zone). The Altman Z-Score is a five-factor model that predicts insolvency within two years; scores below 1.81 indicate significant distress.
Which company has better free cash flow, Aptiv PLC or Texas Instruments Incorporated?▼
Aptiv PLC (APTV) generates a 17.8% free cash flow yield, compared to Texas Instruments Incorporated's 1.5%. A higher FCF yield means the business converts more of its market value into cash that can be returned to shareholders or reinvested.
Which stock has higher return on invested capital, Aptiv PLC or Texas Instruments Incorporated?▼
TXN earns 20.4% ROIC versus APTV's 14.2%. A higher ROIC means the company generates more profit per dollar of capital employed, a hallmark of durable competitive advantage in Buffett-style analysis.