TE Connectivity (TEL) AI Stock Analysis

• Market Cap: $61.62B
• Dividend Yield: 1.3%
• Average Volume (3M): 1.79M
• Price to Earnings (P/E): 42.5
• Beta (1Y): 1.30
• Revenue Growth: 4.86%
• EPS Growth: -56.43%
• Country: US
• Employees: 85,000
• Sector: Technology
• Sector Strength: 83
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 2.27
• Shares Outstanding: 295,481,480
• 10 Day Avg. Volume: 1,646,052
• 30 Day Avg. Volume: 1,789,726
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.89
• Enterprise Value/Revenue: 3.31
• Enterprise Value/Gross Profit: 9.45
• Enterprise Value/Ebitda: 14.25
• 1Y Price Target: $213.77
• Price Target Upside: 2.41% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 13

• Rating: 72 Outperform
• Price Target: $228.00 ▲(9.23% Upside)

TE Connectivity's overall stock score is driven by strong financial performance and positive earnings call outcomes, indicating robust growth and operational efficiency. However, the stock's valuation appears stretched, and technical indicators suggest potential short-term corrections due to overbought conditions. The optimistic guidance and strategic investments provide a positive outlook, but caution is advised given the current valuation metrics.

Positive Factors

AI Growth

TEL's AI revenue ramp continues to be strong with the company ramping programs at multiple hyperscalers.

Earnings and Valuation

TEL is trading up 11% as Q3 EPS beat and the Q4 EPS guide was 6% above consensus.

Industrial Performance

The Industrial segment grew 20% organically, driven by broad-based growth in digital data networks and energy businesses.

Negative Factors

Demand Concerns

There is a risk of prebuy masquerading as underlying demand, which is likely the biggest near-term potential risk in markets like automation and connected living.

Market Weakness

Weak Q3 GoM reflects market weakness in Western markets, which is offset by strong growth in Asia.

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 solutions across various sectors. The company's key revenue streams include automotive products, industrial solutions, and communication and data solutions. TE Connectivity partners with major manufacturers and OEMs to provide tailored solutions that meet specific industry needs, driving demand for its products. Additionally, the company invests in research and development to innovate and expand its product offerings, which helps maintain a competitive edge in the market. Economic trends, technological advancements, and the growth of industries such as electric vehicles and smart devices also contribute to its earnings.

TE Connectivity Financial Statement Overview

Summary

TE Connectivity shows a robust financial profile with strong profitability margins, stable leverage, and efficient cash flow management. The income statement reflects solid operational efficiency, while the balance sheet indicates a stable financial position with room for improved equity utilization. Overall, the company efficiently generates and manages cash flows.

Income Statement

TE Connectivity has demonstrated solid financial performance in its income statement. The TTM (Trailing-Twelve-Months) gross profit margin stands at 34.98% and net profit margin at 8.77%, indicating strong operational efficiency and profitability. The revenue growth rate from the previous period is 4.64%, showing moderate growth. The EBIT margin is at 18.39% and the EBITDA margin is 21.83%, reflecting robust earnings before interest and taxes. Overall, the company is performing well in generating revenues and converting them into profits.

Balance Sheet

TE Connectivity's balance sheet reflects a stable financial position. The debt-to-equity ratio is 0.46, suggesting a balanced approach to leveraging. The return on equity (ROE) is 11.75%, which is a healthy indicator of profitability relative to shareholder equity. The equity ratio is 49.78%, highlighting a strong equity position compared to total assets. Though the financial structure is stable, there is room for improvement in equity utilization to enhance profitability.

Cash Flow

The company's cash flow performance is commendable. The free cash flow growth rate is 3.03%, indicating positive cash generation. The operating cash flow to net income ratio is 2.58, and the free cash flow to net income ratio is 1.98, both showcasing efficient cash conversion from income. Overall, TE Connectivity manages its cash flows effectively, ensuring sufficient liquidity and operational flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	16.58B	15.85B	16.03B	16.28B	14.92B	12.17B
Gross Profit	5.81B	5.32B	4.98B	5.24B	4.73B	3.66B
EBITDA	3.85B	3.69B	3.14B	3.58B	3.20B	1.28B
Net Income	1.46B	3.19B	1.91B	2.43B	2.26B	-241.00M
Balance Sheet
Total Assets	24.87B	22.85B	21.71B	20.78B	21.46B	19.24B
Cash, Cash Equivalents and Short-Term Investments	672.00M	1.32B	1.66B	1.09B	1.20B	945.00M
Total Debt	5.70B	4.33B	4.33B	4.33B	4.21B	4.26B
Total Liabilities	12.34B	10.37B	10.06B	9.88B	10.71B	9.75B
Stockholders Equity	12.38B	12.36B	11.55B	10.80B	10.63B	9.38B
Cash Flow
Free Cash Flow	2.88B	2.80B	2.40B	1.70B	1.99B	1.43B
Operating Cash Flow	3.76B	3.48B	3.13B	2.47B	2.68B	1.99B
Investing Cash Flow	-3.50B	-950.00M	-768.00M	-878.00M	-1.04B	-865.00M
Financing Cash Flow	-1.06B	-2.87B	-1.79B	-1.68B	-1.39B	-1.10B

TE Connectivity Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 208.74
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• 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 208.74 is above the 20-day moving average (MA) of 204.53, above the 50-day MA of 193.21, and above the 200-day MA of 159.30, indicating a bullish trend. The MACD of 3.76 indicates Positive momentum. The RSI at 64.79 is Neutral, neither overbought nor oversold. The STOCH value of 79.80 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
APH	81 Outperform	$137.66B	44.16	31.02%	0.60%	40.51%	49.81%
KEYS	74 Outperform	$28.69B	53.19	9.98%	―	4.80%	-39.55%
FLEX	74 Outperform	$20.71B	24.23	17.67%	―	-3.63%	2.26%
TEL	72 Outperform	$61.62B	42.53	11.63%	1.30%	4.86%	-56.43%
GLW	71 Outperform	$59.72B	73.82	7.55%	1.57%	14.63%	86.61%
JBL	67 Neutral	$22.32B	40.43	32.41%	0.15%	-6.13%	-53.35%
Sector *	61 Neutral	$35.52B	8.84	-11.06%	1.87%	8.55%	-8.14%

TE Connectivity Corporate Events

TE Connectivity Reports Strong Q3 2025 Financial Results

TE Connectivity reported strong financial results for the third quarter of fiscal 2025, with net sales reaching a record $4.5 billion, a 14% increase year over year. The company’s Industrial segment drove this growth, particularly through high-speed connectivity solutions for AI applications and energy business expansion. The company achieved a record adjusted EPS of $2.27, marking a 19% increase, and generated significant cash flow. TE Connectivity also completed the acquisition of Richards in the Industrial segment for $2.3 billion and returned $1.5 billion to shareholders. The company expects continued momentum into the fourth quarter, forecasting double-digit sales and earnings growth.

The most recent analyst rating on (TEL) stock is a Buy with a $200.00 price target. To see the full list of analyst forecasts on TE Connectivity stock, see the TEL Stock Forecast page.