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TE Connectivity
(NYSE:TEL)
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Rating:78Outperform
Price Target:
$238.00
▲(17.28% Upside)
Action:Reiterated
Date:07/22/26
TEL scores well primarily on strong financial performance and a bullish earnings update (record orders/backlog, margin expansion, and robust free cash flow with clear growth guidance). The score is tempered by mixed technicals (negative MACD and below the 200-day average) and only moderate valuation support (P/E ~20.6 and a modest ~1.39% dividend yield).
Positive Factors
High and improving profitability
TE’s margin profile and returns indicate durable economics from engineered components and design‑in positions. High gross and operating margins reflect pricing power and differentiated products that support sustained profitability across multi‑year OEM programs, cushioning cyclicality.
Negative Factors
Concentration of near‑term growth in AI/DDN
Heavy reliance on AI/DDN demand concentrates revenue and margin risk: if hyperscale capex or AI spending shifts, TE could see disproportionate swings. Concentration reduces diversification benefits and makes near‑term growth contingent on a single secular cycle.
Read all positive and negative factors
Positive Factors
Negative Factors
High and improving profitability
TE’s margin profile and returns indicate durable economics from engineered components and design‑in positions. High gross and operating margins reflect pricing power and differentiated products that support sustained profitability across multi‑year OEM programs, cushioning cyclicality.
Read all positive factors
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.
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The Fly
The FlyTE Connectivity (TEL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$59.55B
Dividend Yield1.41%
Average Volume (3M)2.51M
Price to Earnings (P/E)20.0
Beta (1Y)1.34
Revenue Growth16.53%
EPS Growth110.98%
CountryUS
Employees90,000
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)10.29
Shares Outstanding289,513,200
10 Day Avg. Volume3,065,529
30 Day Avg. Volume2,510,745
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 Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$250.45Price Target Upside23.41% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
EPS Forecast (FY)11.43
Revenue Forecast (FY)$19.82B
TE Connectivity Business Overview & Revenue Model
Company Description
TE Connectivity plc, together with its subsidiaries, manufactures and sells connectivity and sensor solutions in Europe, the Middle East, Africa, the AsiaPacific, and the Americas. The company operates through two reportable segments, Transportat...
How the Company Makes Money
TE Connectivity primarily makes money by selling engineered components—most notably connectors and sensors—directly to original equipment manufacturers (OEMs) and to other industrial customers that integrate TE parts into finished products. Revenu...
TE Connectivity Earnings Call Summary
Earnings Call Date:Jul 22, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Nov 04, 2026
Earnings Call Sentiment Positive
The call presents a strong positive operational and financial performance: record orders and backlog, double-digit revenue growth, margin expansion, robust free cash flow, and strategic M&A to broaden power capabilities. Most growth is driven by Industrial/AI-related demand (DDN and energy), while Transportation and some cyclical businesses lag. Management reiterated targets and constructive outlook into FY2027, but near-term risks include China auto market softness, restructuring charges, inflationary pressures, and delayed revenue contribution from FAU optical investments.Positive Updates
Strong Quarterly Revenue
Sales of $5.2 billion in Q3, up 14% reported and 12% organic year-over-year, with guidance for Q4 sales of approximately $5.25 billion (+11% vs prior year) and full-year sales growth now expected at ~15%.
Negative Updates
Near-Term Optical/FAU Revenue Timing
FAU optical opportunity (RAM Photonics) is strategic but early — meaningful revenue contribution not expected until ~2028 and beyond, limiting near-term upside from scale-out optical.
Read all updates
Q3-2026 Updates
Positive
Negative
Strong Quarterly Revenue
Sales of $5.2 billion in Q3, up 14% reported and 12% organic year-over-year, with guidance for Q4 sales of approximately $5.25 billion (+11% vs prior year) and full-year sales growth now expected at ~15%.
Read all positive updates
Company Guidance
TE gave concrete near‑term and full‑year targets: Q3 sales were $5.2B (up 14% reported / 12% organic) with record orders of $5.7B (+27% YoY, +7% seq.), a book‑to‑bill of 1.1, adjusted EPS of $2.94 (+22%) and adjusted operating margin of 21.9% (up 90 bps); cash from ops was $1.2B and Q3 free cash flow $883M (YTD FCF ≈ $2.2B) with ≈ $2B returned to shareholders YTD and expected FCF conversion ~100%; Q4 guidance is sales ≈ $5.25B (+11% YoY) and adjusted EPS ≈ $3.05, and full‑year guidance is ~15% sales growth (>$2.5B incremental revenue) with adjusted EPS growth ~23% (above 20%); other notable metrics: Industrial sales +22% (organic +21%) with DDN sales +34% (DDN orders YTD >70%), Industrial orders +36% and Transportation orders +19% YTD, Industrial adjusted margin ≈23% (up 70 bps), Transportation margin 21%, Q3 GAAP operating income $981M (including $9M acquisition‑related, $83M restructuring, $56M amortization), Q3 adjusted tax rate 23% (Q4 22–23% expected), restructuring for FY26 ~ $100M, and the announced Astrodyne TDI bolt‑on (≈$1.4B purchase price, >$250M annual sales, expected close by year‑end).TE Connectivity Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
82
Very Positive
Cash Flow
78
Positive
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 19.15B | 17.09B | 15.85B | 16.03B | 16.28B | 14.92B |
| Gross Profit | 6.78B | 5.91B | 5.46B | 4.98B | 5.13B | 4.73B |
| EBITDA | 4.60B | 4.12B | 3.69B | 3.14B | 3.58B | 3.20B |
| Net Income | 3.02B | 1.84B | 3.19B | 1.91B | 2.43B | 2.26B |
Balance Sheet | ||||||
| Total Assets | 26.07B | 25.08B | 22.85B | 21.71B | 20.78B | 21.46B |
| Cash, Cash Equivalents and Short-Term Investments | 1.24B | 1.25B | 1.32B | 1.66B | 1.09B | 1.20B |
| Total Debt | 5.63B | 6.55B | 4.96B | 4.89B | 4.95B | 4.88B |
| Total Liabilities | 12.68B | 12.35B | 10.37B | 10.06B | 9.88B | 10.71B |
| Stockholders Equity | 13.25B | 12.59B | 12.36B | 11.55B | 10.80B | 10.63B |
Cash Flow | ||||||
| Free Cash Flow | 3.64B | 3.20B | 2.80B | 2.40B | 1.70B | 1.99B |
| Operating Cash Flow | 4.74B | 4.14B | 3.48B | 3.13B | 2.47B | 2.68B |
| Investing Cash Flow | -1.30B | -3.57B | -950.00M | -768.00M | -878.00M | -1.04B |
| Financing Cash Flow | -2.55B | -629.00M | -2.87B | -1.79B | -1.68B | -1.39B |
TE Connectivity Technical Analysis
Negative
202.94
Price Trends
205.79
Negative
208.56
Negative
218.62
Negative
Market Momentum
-0.96
Negative
49.93
Neutral
47.88
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TEL, the sentiment is Negative. The current price of 202.94 is above the 20-day moving average (MA) of 202.76, below the 50-day MA of 205.79, and below the 200-day MA of 218.62, indicating a neutral trend. The MACD of -0.96 indicates Negative momentum. The RSI at 49.93 is Neutral, neither overbought nor oversold. The STOCH value of 47.88 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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 |
|---|---|---|---|---|---|---|---|
78 Outperform | $59.55B | 19.99 | 23.18% | 1.43% | 16.53% | 110.98% | |
76 Outperform | $54.53B | 52.48 | 17.44% | ― | 19.19% | 42.75% | |
75 Outperform | $197.70B | 38.26 | 37.21% | 0.60% | 54.17% | 59.56% | |
72 Outperform | $33.01B | 38.90 | 62.42% | 0.10% | 17.80% | 55.75% | |
66 Neutral | $119.09B | 62.56 | 15.93% | 0.76% | 19.41% | 131.24% | |
62 Neutral | $41.68B | 43.92 | 18.71% | ― | 12.25% | 14.09% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
TEL
TE Connectivity
205.69
4.48
2.23%
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TE Connectivity Corporate Events
Business Operations and StrategyStock BuybackFinancial DisclosuresM&A Transactions
TE Connectivity Posts Record Q3 Sales and Earnings
Positive
Jul 22, 2026
TE Connectivity reported on July 22, 2026, that its fiscal third quarter ended June 26, 2026 delivered record net sales of $5.16 billion, up 14% year over year on a reported basis and 12% organically, driven by strong growth in its Industrial and ...
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.