TE Connectivity (TEL) AI Stock Analysis

• Market Cap: $69.14B
• Dividend Yield: 1.21%
• Average Volume (3M): 2.24M
• Price to Earnings (P/E): 34.0
• Beta (1Y): 1.25
• Revenue Growth: 8.94%
• EPS Growth: -39.90%
• Country: US
• Employees: 85,000
• Sector: Technology
• Sector Strength: 88
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 2.72
• Shares Outstanding: 293,434,270
• 10 Day Avg. Volume: 1,835,167
• 30 Day Avg. Volume: 2,238,492
• PEG Ratio: -0.87
• Price to Book (P/B): 5.12
• Price to Sales (P/S): 3.77
• P/FCF Ratio: 20.13
• Enterprise Value/Market Cap: 1.06
• Enterprise Value/Revenue: 4.09
• Enterprise Value/Gross Profit: 11.71
• Enterprise Value/Ebitda: 16.41
• 1Y Price Target: $281.55
• Price Target Upside: 19.95% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 11
• EPS Forecast (FY): 11.03
• Revenue Forecast (FY): $19.38B

• Rating: 71 Outperform
• Price Target: $261.00 ▲(11.19% Upside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is driven primarily by strong financial performance and a bullish, confident earnings call (record orders, margin expansion, and raised AI outlook). Offsetting factors are a premium valuation (high P/E, modest yield) and mixed near-term technical momentum (negative MACD and elevated Stoch despite an overall uptrend).

Positive Factors

Revenue and order momentum

Sustained double-digit top-line growth and record order intake (book-to-bill >1) provide durable revenue visibility and backlog conversion across cycles. Broad-based orders across geographies and segments reduce single-market risk and support multi-quarter demand predictability for production ramps.

Robust cash generation and capital returns

High absolute operating cash flow and strong FCF conversion underpin long-term financial flexibility. Reliable cash generation funds buybacks, dividends, deleveraging or targeted reinvestment, enabling capital allocation discipline and resilience through sector cyclicality without relying solely on external funding.

Strategic exposure to AI and data connectivity

Leading connectivity and sensor exposure to hyperscale AI, digital data networks and grid hardening taps structural secular tailwinds. Higher content per system and multi-year program ramps support sustained revenue growth and margin improvement as customers invest in data-center and electrification infrastructure.

Negative Factors

Increased leverage versus prior years

A higher leverage profile reduces balance-sheet cushion against demand shocks and limits flexibility for large M&A or prolonged buybacks. Covenant headroom and higher fixed interest costs can force prioritization between investment, share repurchases and debt reduction during economic or end-market slowdowns.

Transportation/auto cyclicality and seasonality

Material exposure to automotive and commercial transport brings pronounced seasonality and cyclicality to revenue and margins. Auto production swings can quickly reduce volumes and incremental margins, creating lumpy quarterly performance and forcing short-term margin trade-offs in pricing or factory utilization.

Metals inflation and input-cost pressure

Metals are a major input and sustained commodity inflation compresses gross margins unless fully offset by pricing or sourcing gains. Pass-through pricing can lag and OEM price sensitivity limits elasticity, raising the risk to margin sustainability and requiring continuous procurement and product-cost discipline.

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 Solutions, Industrial Solutions, and Communications Solutions. The Transportation Solutions segment provides terminals and connector systems and components, sensors, relays, antennas, heat shrink tubing, and application tooling products for use in the automotive, commercial transportation, and sensor markets. The Industrial Solutions segment offers terminals and connector systems and components; and heat shrink tubing, interventional medical components, relays, and wires and cables for aerospace, defense, oil and gas, industrial equipment, medical, and energy markets. The Communications Solutions segment supplies electronic components, such as terminals and connector systems and components, relays, heat shrink tubing, and antennas for the data and devices, and appliances markets. TE Connectivity Ltd. sells its products to approximately 140 countries primarily through direct sales to manufacturers, as well as through third-party distributors. The company was formerly known as Tyco Electronics Ltd. and changed its name to TE Connectivity Ltd. in March 2011. TE Connectivity Ltd. was incorporated in 2000 and is based in Schaffhausen, Switzerland.

How the Company Makes Money

TE Connectivity generates revenue primarily through the sale of its connectivity and sensor products. Its revenue model is based on the development, manufacturing, and distribution of high-performance components that are integral to various industries. Key revenue streams include the sale of connectors, sensors, and wire and cable products. The company has established significant partnerships with leading manufacturers and original equipment manufacturers (OEMs) across different sectors, which enhances its market reach and drives sales. Additionally, TE Connectivity benefits from long-term contracts and relationships with customers, providing a stable revenue base. The demand for advanced connectivity solutions, driven by trends such as automation, electrification, and the Internet of Things (IoT), further contributes to the company's earnings.

TE Connectivity Financial Statement Overview

Summary

Overall financial quality is strong: solid profitability and margins, attractive returns, and robust free cash flow generation. Key risks are a normalization in net profitability versus the unusually strong FY2024 level, slightly softer TTM free cash flow versus the prior year, and moderately higher leverage than FY2022–FY2024.

Income Statement

TEL’s TTM (Trailing-Twelve-Months) results show solid profitability with healthy gross profit and operating margins, supporting strong earnings power for an industrial/hardware profile. Revenue growth is positive in TTM (Trailing-Twelve-Months) after prior annual periods that were slightly down, indicating a return to growth. A key watch item is the notable drop in net margin versus FY2024 (which appears unusually high), bringing profitability back to a more normal range and suggesting less benefit from one-time items or mix/tailwinds than the prior year.

Balance Sheet

Leverage is moderate with debt at roughly mid-range relative to equity (debt-to-equity around the mid-0.4x area in the latest periods), which provides balance-sheet flexibility without looking overly aggressive. Equity and assets have trended higher over time, and returns on equity are attractive in the mid-teens on the most recent periods, though below the exceptionally strong FY2024 level. The main risk is that leverage has stepped up versus FY2022–FY2024 levels, reducing some cushion if industry conditions soften.

Cash Flow

Cash generation is a clear strength: operating cash flow and free cash flow are large in absolute terms, with free cash flow running at a strong proportion of earnings (roughly three-quarters+ in recent periods), supporting buybacks, debt paydown, or reinvestment. That said, TTM (Trailing-Twelve-Months) free cash flow is slightly down versus the prior annual period, and cash conversion is good but not perfect (operating cash flow is below net income), implying some working-capital or timing headwinds that can create quarter-to-quarter volatility.

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

• Technical Analysis Sentiment: Positive
• Last Price: 234.73
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: 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 234.73 is above the 20-day moving average (MA) of 225.63, above the 50-day MA of 229.51, and above the 200-day MA of 206.56, indicating a bullish trend. The MACD of 1.19 indicates Negative momentum. The RSI at 56.08 is Neutral, neither overbought nor oversold. The STOCH value of 76.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TEL.

TE Connectivity Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KEYS	77 Outperform	$41.14B	49.04	15.82%	―	7.95%	39.54%
APH	76 Outperform	$181.59B	44.19	36.80%	0.54%	47.37%	72.30%
JBL	73 Outperform	$27.51B	40.53	47.87%	0.14%	13.18%	-38.37%
FLEX	72 Outperform	$24.20B	29.15	16.85%	―	0.77%	0.51%
TEL	71 Outperform	$69.14B	33.98	16.27%	1.21%	8.94%	-39.90%
GLW	70 Outperform	$113.26B	72.04	14.19%	1.25%	18.27%	771.78%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

TE Connectivity Corporate Events

TE Connectivity Expands Liquidity with New $3B Credit Facility

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 terminated without penalty ahead of its April 2029 expiry. The new facility, which backs the company’s commercial paper program, matures on February 13, 2031 with options for up to two one-year extensions and an accordion feature of up to $1 billion.

Borrowings can be made in U.S. dollars, euro, sterling and yen at benchmark-based floating rates plus a margin tied to TEGSA’s long-term unsecured credit rating, and TE must pay an annual facility fee ranging from 5.0 to 12.5 basis points on lender commitments. The agreement includes a leverage covenant capping consolidated total debt to EBITDA at 3.75x, or 4.25x following qualifying acquisitions, underscoring lender discipline while significantly enhancing TE Connectivity’s committed liquidity and financial flexibility.

The most recent analyst rating on (TEL) stock is a Buy with a $285.00 price target. To see the full list of analyst forecasts on TE Connectivity stock, see the TEL Stock Forecast page.

TE Connectivity Subsidiary Issues New Senior Notes Offering

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. The new 2031 tranche is fully fungible with the company’s existing 2031 notes, bringing that series to $650 million outstanding and maintaining an unsecured senior ranking guaranteed by TE Connectivity and TE Connectivity Switzerland.

The offering generated approximately $745.5 million in net proceeds, which TE Connectivity is using to repay outstanding debt, including its 3.700% and 4.500% senior notes due 2026, and for general corporate purposes. By extending its debt maturity profile and locking in fixed-rate funding, the company is refining its capital structure and potentially lowering refinancing risk, while major global banks acted as joint bookrunners in the transaction.

The most recent analyst rating on (TEL) stock is a Buy with a $270.00 price target. To see the full list of analyst forecasts on TE Connectivity stock, see the TEL Stock Forecast page.

TE Connectivity Posts Strong Fiscal Q1 2026 Results

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 strength in both its Industrial and Transportation segments. GAAP diluted EPS from continuing operations climbed 45% to $2.53 and adjusted EPS increased 33% to $2.72, while GAAP operating margin improved 260 basis points to 20.6% and adjusted operating margin expanded to 22.2% on strong operational execution, supported by record quarterly orders of $5.1 billion, robust cash generation and significant capital returns to shareholders. Management highlighted growing demand from data and power connectivity applications in AI, grid hardening and next-generation vehicles, and projected continued momentum with double-digit sales and adjusted earnings growth expected in the second quarter of fiscal 2026, alongside a shift in non-GAAP reporting to exclude amortization of intangible assets.

The most recent analyst rating on (TEL) stock is a Buy with a $304.00 price target. To see the full list of analyst forecasts on TE Connectivity stock, see the TEL Stock Forecast page.

TE Connectivity Unveils Strategic Growth Plans at Investor Day

On November 20, 2025, TE Connectivity held its investor day in Philadelphia, where it presented its strategic plans for future growth. The company aims to achieve 6-8% growth through a combination of organic and inorganic opportunities, focusing on operational excellence and market recovery. TE Connectivity is also emphasizing its strong financial foundation, with a projected sales growth to $17 billion and an adjusted operating margin of over 21%. The company is positioned to deliver significant shareholder value through a disciplined capital strategy, focusing on high-return opportunities and maintaining a strong presence in the global automotive market.

The most recent analyst rating on (TEL) stock is a Buy with a $275.00 price target. To see the full list of analyst forecasts on TE Connectivity stock, see the TEL Stock Forecast page.