TE Connectivity plc (NYSE:TEL) Just Released Its Annual Earnings: Here's What Analysts Think
Investors in TE Connectivity plc (NYSE:TEL) had a good week, as its shares rose 2.4% to close at US$213 following the release of its full-year results. Results were roughly in line with estimates, with revenues of US$20b and statutory earnings per share of US$11.07. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on TE Connectivity after the latest results.
Taking into account the latest results, the consensus forecast from TE Connectivity's 13 analysts is for revenues of US$22.4b in 2027. This reflects a decent 12% improvement in revenue compared to the last 12 months. Per-share earnings are expected to grow 15% to US$12.99. Before this earnings report, the analysts had been forecasting revenues of US$21.7b and earnings per share (EPS) of US$12.48 in 2027. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.
Check out our latest analysis for TE Connectivity
Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of US$258, suggesting that the forecast performance does not have a long term impact on the company's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values TE Connectivity at US$306 per share, while the most bearish prices it at US$225. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting TE Connectivity's growth to accelerate, with the forecast 12% annualised growth to the end of 2027 ranking favourably alongside historical growth of 4.1% per annum over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 14% per year. TE Connectivity is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around TE Connectivity's earnings potential next year. They also upgraded their revenue forecasts, although the latest estimates suggest that TE Connectivity will grow in line with the overall industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for TE Connectivity going out to 2029, and you can see them free on our platform here.
You can also view our analysis of TE Connectivity's balance sheet, and whether we think TE Connectivity is carrying too much debt, for free on our platform here.
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