TE Connectivity Ltd. (TEL)
NYSE:TEL
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TE Connectivity
(NYSE:TEL)
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Rating:72Outperform
Price Target:
$228.00
▲(8.07% Upside)
Action:ReiteratedDate:03/12/26
The score is driven primarily by strong underlying financial quality (profitability and robust free cash flow) and a very constructive earnings outlook with raised AI expectations and record orders. These positives are tempered by weak technical momentum (below major moving averages with negative MACD) and a valuation that is not especially cheap, with a modest dividend yield.
Positive Factors
Free cash flow generation
Consistent, large operating cash flow and high free cash flow conversion provide durable financial flexibility. Strong FCF funds buybacks, debt reduction, reinvestment in tooling/CapEx and supports capital returns through cycles, reducing reliance on volatile external financing.
Negative Factors
Stepped-up leverage
Higher leverage versus recent years narrows the firm's financial cushion against downturns. With elevated indebtedness, interest and covenant sensitivity rise, potentially restricting M&A optionality or forcing more conservative capital allocation if cyclicality depresses EBITDA.
Read all positive and negative factors
Positive Factors
Negative Factors
Free cash flow generation
Consistent, large operating cash flow and high free cash flow conversion provide durable financial flexibility. Strong FCF funds buybacks, debt reduction, reinvestment in tooling/CapEx and supports capital returns through cycles, reducing reliance on volatile external financing.
Read all positive factors
TE Connectivity (TEL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$61.54B
Dividend Yield1.21%
Average Volume (3M)2.24M
Price to Earnings (P/E)22.8
Beta (1Y)1.26
Revenue Growth8.94%
EPS Growth-39.90%
CountryUS
Employees85,000
SectorTechnology
Sector Strength88
IndustryHardware, Equipment & Parts
Share Statistics
EPS (TTM)2.72
Shares Outstanding293,434,270
10 Day Avg. Volume2,187,370
30 Day Avg. Volume2,241,375
Financial Highlights & Ratios
PEG Ratio-0.87
Price to Book (P/B)5.12
Price to Sales (P/S)3.77
P/FCF Ratio20.13
Enterprise Value/Market Cap1.08
Enterprise Value/Revenue3.70
Enterprise Value/Gross Profit10.60
Enterprise Value/Ebitda14.85
Forecast
1Y Price Target
$275.64Price Target Upside30.65% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering11
EPS Forecast (FY)11.07
Revenue Forecast (FY)$19.42B
TE Connectivity Business Overview & Revenue Model
Company Description
TE Connectivity Ltd., together with its subsidiaries, manufactures and sells connectivity and sensor solutions in Europe, the Middle East, Africa, the Asia Pacific, and the Americas. The company operates through three segments: Transportation Solu...
How the Company Makes Money
TE Connectivity primarily makes money by selling engineered electronic components—most notably connectors/interconnects and sensors—into multiple end markets through a design-in, high-volume manufacturing model. Revenue is generated when OEMs and ...
TE Connectivity Key Performance Indicators (KPIs)
Any
Net Sales by Segment
Shows revenue generated from each business segment, indicating which parts of the company are growing and contributing most to overall sales.
Shows revenue generated from each business segment, indicating which parts of the company are growing and contributing most to overall sales.
Data provided by:
The Fly
The FlyTE Connectivity Earnings Call Summary
Earnings Call Date:Jan 21, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Apr 29, 2026
Earnings Call Sentiment Positive
The call conveyed strong and broad-based growth with record orders, double-digit sales expansion, substantial margin improvement and robust cash generation, supported by accelerating AI and digital data networks demand. Near-term headwinds include auto seasonality, metal cost inflation, restructuring charges, and some end-market softness (e.g., North American trucks, appliances), with part of the AI upside skewed to the back half of the year. Overall, the company signaled confidence in achieving above-cycle growth for fiscal 2026 while investing to support the AI ramps.Positive Updates
Strong Top-Line Growth
Revenue of $4.7 billion in Q1, up 22% reported and 15% organic year-over-year, with growth in both segments and sales above guidance.
Negative Updates
Auto Seasonality and Near-Term Transport Headwind
Q2 guidance reflects a near-term transportation decline driven by typical auto seasonality (approximate 3 million unit production decline Q1→Q2); full-year global auto production view ~88 million units, slightly down year-over-year.
Read all updates
Q1-2026 Updates
Positive
Negative
Strong Top-Line Growth
Revenue of $4.7 billion in Q1, up 22% reported and 15% organic year-over-year, with growth in both segments and sales above guidance.
Read all positive updates
Company Guidance
TE guided that momentum should continue in FY‑26 after a strong Q1: Q1 sales were $4.7B (up 22% reported, 15% organic) with record orders of $5.1B (book‑to‑bill 1.1), adjusted operating income >$1.0B and adjusted operating margin 22.2% (+180 bps YoY), adjusted EPS $2.72 (+33% YoY), GAAP operating income $963M, cash from ops $865M and free cash flow $608M (≈100% returned to shareholders); they expect Q2 sales of about $4.7B (up ~13% reported, ~6% organic) and adjusted EPS ≈$2.65 (~20% YoY), with Industrial Solutions to grow sequentially while Transportation is partly offset by normal auto seasonality (company expects ~88M auto production units for FY with a ~3M unit Q1→Q2 decline); management raised AI revenue expectations for FY‑26 by roughly $200M (with a multi‑year AI target of ~$3B), is increasing CapEx toward ~6% of sales to support ramps, expects an adjusted effective tax rate ~22% in Q2 (~23% for the year), about $100M of restructuring in FY‑26, at least 100% FCF conversion and continued double‑digit EPS growth.TE Connectivity Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
74
Positive
Cash Flow
80
Positive
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 17.92B | 17.09B | 15.85B | 16.03B | 16.28B | 14.92B |
| Gross Profit | 6.26B | 5.91B | 5.46B | 4.98B | 5.13B | 4.73B |
| EBITDA | 4.47B | 4.12B | 3.69B | 3.14B | 3.58B | 3.20B |
| Net Income | 2.06B | 1.84B | 3.19B | 1.91B | 2.43B | 2.26B |
Balance Sheet | ||||||
| Total Assets | 25.55B | 25.08B | 22.85B | 21.71B | 20.78B | 21.46B |
| Cash, Cash Equivalents and Short-Term Investments | 1.25B | 1.25B | 1.32B | 1.66B | 1.09B | 1.20B |
| Total Debt | 5.71B | 6.55B | 4.96B | 4.89B | 4.95B | 4.88B |
| Total Liabilities | 12.42B | 12.35B | 10.37B | 10.06B | 9.88B | 10.71B |
| Stockholders Equity | 12.99B | 12.59B | 12.36B | 11.55B | 10.80B | 10.63B |
Cash Flow | ||||||
| Free Cash Flow | 3.14B | 3.20B | 2.80B | 2.40B | 1.70B | 1.99B |
| Operating Cash Flow | 4.13B | 4.14B | 3.48B | 3.13B | 2.47B | 2.68B |
| Investing Cash Flow | -3.29B | -3.57B | -950.00M | -768.00M | -878.00M | -1.04B |
| Financing Cash Flow | -850.00M | -629.00M | -2.87B | -1.79B | -1.68B | -1.39B |
TE Connectivity Technical Analysis
Positive
210.98
Price Trends
216.12
Negative
223.76
Negative
214.17
Negative
Market Momentum
-2.27
Negative
50.74
Neutral
75.88
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TEL, the sentiment is Positive. The current price of 210.98 is above the 20-day moving average (MA) of 203.52, below the 50-day MA of 216.12, and below the 200-day MA of 214.17, indicating a neutral trend. The MACD of -2.27 indicates Negative momentum. The RSI at 50.74 is Neutral, neither overbought nor oversold. The STOCH value of 75.88 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TEL.
TE Connectivity Risk Analysis
TE Connectivity disclosed 42 risk factors in its most recent earnings report. TE Connectivity reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
TE Connectivity Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $25.08B | 23.76 | 16.83% | ― | 0.77% | 0.51% | |
74 Outperform | $51.56B | 33.10 | 16.50% | ― | 7.95% | 39.54% | |
72 Outperform | $61.54B | 22.78 | 16.50% | 1.21% | 8.94% | -39.90% | |
70 Outperform | $157.81B | 38.55 | 35.77% | 0.54% | 47.37% | 72.30% | |
69 Neutral | $28.81B | 31.64 | 58.99% | 0.14% | 13.18% | -38.37% | |
66 Neutral | $127.42B | 47.18 | 14.13% | 1.25% | 18.27% | 771.78% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
TEL
TE Connectivity
210.98
79.02
59.88%
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TE Connectivity Corporate Events
Business Operations and StrategyStock BuybackShareholder Meetings
TE Connectivity Shareholders Back Board and Governance Proposals
Positive
Mar 12, 2026
At its Annual General Meeting on March 11, 2026, TE Connectivity secured strong shareholder backing for all agenda items, with a quorum of more than 90% of eligible shares present by proxy. All 13 director nominees were elected with comfortable ma...
Business Operations and StrategyPrivate Placements and Financing
TE Connectivity Expands Liquidity with New $3B Credit Facility
Positive
Feb 17, 2026
On February 13, 2026, TE Connectivity plc entered into a new five-year senior revolving credit facility of $3 billion through its subsidiary Tyco Electronics Group S.A., replacing an existing $1.5 billion unsecured facility that was concurrently t...
Business Operations and StrategyPrivate Placements and Financing
TE Connectivity Subsidiary Issues New Senior Notes Offering
Positive
Feb 9, 2026
On February 9, 2026, Tyco Electronics Group S.A., a wholly owned subsidiary of TE Connectivity, issued $200 million of additional 4.500% senior notes due 2031 and $550 million of 4.875% senior notes due 2036 under an existing shelf registration. T...
Business Operations and StrategyFinancial Disclosures
TE Connectivity Posts Strong Fiscal Q1 2026 Results
Positive
Jan 21, 2026
On January 21, 2026, TE Connectivity reported that fiscal first-quarter 2026 results for the period ended December 26, 2025 exceeded guidance, with net sales rising 22% year over year to $4.7 billion, including 15% organic growth, driven by streng...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.