Why NYSE:TEL qualifies as a good dividend investing stock.

Consider TE CONNECTIVITY LTD (NYSE:TEL) as a top pick for dividend investors, identified by our stock screening tool. NYSE:TEL shines in terms of profitability, solvency, and liquidity, all while paying a decent dividend. Let's dive deeper into the analysis.

Dividend Analysis for NYSE:TEL

An integral part of ChartMill's stock analysis is the Dividend Rating, which spans from 0 to 10. This rating evaluates diverse dividend factors, including yield, historical data, growth, and sustainability. NYSE:TEL has received a 7 out of 10:

• Compared to an average industry Dividend Yield of 1.67, TEL pays a better dividend. On top of this TEL pays more dividend than 93.60% of the companies listed in the same industry.
• The dividend of TEL is nicely growing with an annual growth rate of 6.41%!
• TEL has been paying a dividend for at least 10 years, so it has a reliable track record.
• TEL has not decreased their dividend for at least 10 years, which is a reliable track record.
• TEL pays out 37.96% of its income as dividend. This is a sustainable payout ratio.
• The dividend of TEL is growing, but earnings are growing more, so the dividend growth is sustainable.

A Closer Look at Health for NYSE:TEL

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NYSE:TEL, the assigned 7 for health provides valuable insights:

• An Altman-Z score of 4.57 indicates that TEL is not in any danger for bankruptcy at the moment.
• Looking at the Altman-Z score, with a value of 4.57, TEL is in the better half of the industry, outperforming 75.20% of the companies in the same industry.
• The Debt to FCF ratio of TEL is 1.75, which is an excellent value as it means it would take TEL, only 1.75 years of fcf income to pay off all of its debts.
• Looking at the Debt to FCF ratio, with a value of 1.75, TEL is in the better half of the industry, outperforming 74.40% of the companies in the same industry.
• A Debt/Equity ratio of 0.31 indicates that TEL is not too dependend on debt financing.
• Although TEL does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.

Profitability Insights: NYSE:TEL

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NYSE:TEL scores a 7 out of 10:

• TEL has a Return On Assets of 8.80%. This is amongst the best in the industry. TEL outperforms 91.20% of its industry peers.
• TEL's Return On Equity of 16.54% is amongst the best of the industry. TEL outperforms 88.80% of its industry peers.
• Looking at the Return On Invested Capital, with a value of 13.39%, TEL belongs to the top of the industry, outperforming 88.00% of the companies in the same industry.
• Measured over the past 3 years, the Average Return On Invested Capital for TEL is above the industry average of 9.63%.
• TEL has a better Profit Margin (11.91%) than 91.20% of its industry peers.
• TEL's Operating Margin of 16.68% is amongst the best of the industry. TEL outperforms 92.00% of its industry peers.

Our Best Dividend screener lists more Best Dividend stocks and is updated daily.

Check the latest full fundamental report of TEL for a complete fundamental analysis.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.