ALGM vs TXN: Which Is the Better Buy in 2026?

Same yardstick, side by side (as of August 2026). Valuation lined up like this is most meaningful for two names in the same corner of the market, which these are. Figures are approximate; verify before investing.

The metrics above tell you which is the marginally better business. The bigger risk for most people is not picking the slightly worse stock, it is over-concentrating. ALGM and TXN share themes, so owning both, or adding either to what you already hold, can quietly push a large share of your portfolio into one bet.

This is the part a generic comparison page cannot answer, because it depends on what you own. Connect your brokerage and Walnut shows your real, combined ALGM and TXN exposure, flags overlap with your existing positions, and tells you if adding one would tip you past a concentration you are comfortable with, read-only by default, with your login staying at your broker. Walnut is not an investment adviser.

Allegro MicroSystems is a fabless semiconductor company that designs magnetic sensor integrated circuits and application-specific analog power ICs, then outsources most manufacturing to foundry partners. Its magnetic sensors measure position, speed, and current, and its power ICs include motor drivers, voltage regulators, and LED drivers; it also builds photonic and 3D-sensing parts for LiDAR. The bulk of revenue comes from the automotive market, where its chips sit inside electric powertrains, battery systems, advanced driver-assistance systems (ADAS), and comfort and safety motors, with a second leg in industrial automation, data centers, and clean-energy applications. Allegro holds roughly a quarter to a third of the global market for magnetic sensor ICs, one of the larger positions in that niche, built on more than three decades of magnetic-sensing and power expertise.

Full ALGM guide

Texas Instruments (TI) is one of the largest analog semiconductor companies in the world. The vast majority of TI's revenue comes from analog and embedded processing chips: signal-chain semiconductors (op-amps, ADCs, DACs), power management ICs, and small microcontrollers. These are unglamorous compared to GPUs but are essential to nearly every electronic system: industrial equipment, automotive (a major end market), communications infrastructure, and consumer electronics.

Full TXN guide

Both fit overlapping themes, but they are not interchangeable. The useful comparison is which set of drivers and risks you want exposure to.

• ALGM drivers: Rising chip content per vehicle; Current sensing and e-mobility leadership.
• TXN drivers: US-domestic manufacturing capacity expansion; Automotive and industrial as core growth markets.

A faster-growing, richer-valued name usually swings harder, so it suits a longer horizon and a higher tolerance for volatility; a steadier, more cash-generative business suits a more conservative or income-minded investor. The honest test is which set of risks you could hold through a drawdown: The dominant risk is cyclicality and customer concentration in the automotive market, which supplies most of Allegro's revenue, so a downturn in vehicle production, softer EV adoption, or another round of customer inventory destocking can cut sales sharply and quickly. For TXN, the massive US fab expansion compresses margins near-term and creates execution risk if demand doesn't materialize as expected.

Growth-minded investors who believe the theme has years to run tend to accept the richer multiple for more upside; value-minded investors lean toward the cheaper forward earnings and steadier profile. Pick ALGM if you believe its drivers more; TXN if you believe its. Many investors hold both, but since they share themes, that is a concentrated bet, not diversification. Decide deliberately and check overlap. For the full detail, see the ALGM and TXN guides.

ALGM. Figures are approximate and tied to the July 2026 asOf date; verify live numbers before acting. Allegro's fiscal year ends in March, so FY2026 covers the period ending March 2026. GAAP earnings can look distorted by one-time items, so the market watches the non-GAAP figures, and on those the stock trades at a high forward multiple that already prices in continued electrification-driven growth.

TXN. TI's premium valuation reflects the quality of the analog business (sticky designs, long product lifecycles, high margins) and the dividend growth track record. The multiple is pressured near-term by the fab capex; longer-term it normalizes as new capacity comes online.

Headline figures (approximate, July 2026): ALGM shows revenue (fy2026, ended march 2026) ~$890 million, up ~23% year over year, non-gaap eps (fy2026) ~$0.54, more than double the prior year, recent quarterly sales ~$243 million in the latest reported quarter, up ~26% year over year, market cap ~$11 billion (stock in the ~$60s per share); TXN shows revenue (ttm) ~$17 billion (recovering from 2023-2024 trough), operating margin ~38% (compressed by fab capex), net income (ttm) ~$5 billion, eps (ttm) ~$5.50.

ALGM and TXN are related but distinct: same themes, different businesses and risks. Neither wins in the abstract; the right pick is whichever thesis you actually believe, sized so you are not over-concentrated in one theme. Walnut can show your combined ALGM and TXN exposure against your real portfolio. It is not an investment adviser.