TE CONNECTIVITY PLC (TEL) Stock Fundamental Analysis
USA - NYSE:TEL - IE000IVNQZ81 - Common Stock
249 USD
+5.45 (+2.24%)
249 USD
0 (0%)
TEL gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 124 industry peers in the Electronic Equipment, Instruments & Components industry. TEL has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. TEL has a decent growth rate and is not valued too expensively. TEL also has an excellent dividend rating. These ratings could make TEL a good candidate for dividend and quality investing.
1. Profitability
1.1 Basic Checks
TEL had positive earnings in the past year.
TEL had a positive operating cash flow in the past year.
TEL had positive earnings in each of the past 5 years.
Each year in the past 5 years TEL had a positive operating cash flow.
1.2 Ratios
TEL has a better Return On Assets (7.34%) than 86.29% of its industry peers.
The Return On Equity of TEL (14.64%) is better than 82.26% of its industry peers.
With an excellent Return On Invested Capital value of 13.39%, TEL belongs to the best of the industry, outperforming 90.32% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for TEL is above the industry average of 9.51%.
The last Return On Invested Capital (13.39%) for TEL is above the 3 year average (12.89%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.34% | ||
| ROE | 14.64% | ||
| ROIC | 13.39% |
ROA(3y)10.04%
ROA(5y)10.47%
ROE(3y)19.01%
ROE(5y)20.15%
ROIC(3y)12.89%
ROIC(5y)13.15%
1.3 Margins
TEL has a Profit Margin of 10.67%. This is amongst the best in the industry. TEL outperforms 84.68% of its industry peers.
TEL's Profit Margin has declined in the last couple of years.
TEL has a Operating Margin of 19.60%. This is amongst the best in the industry. TEL outperforms 95.97% of its industry peers.
TEL's Operating Margin has improved in the last couple of years.
TEL has a Gross Margin (35.22%) which is in line with its industry peers.
In the last couple of years the Gross Margin of TEL has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.6% | ||
| PM (TTM) | 10.67% | ||
| GM | 35.22% |
OM growth 3Y2.75%
OM growth 5Y6.64%
PM growth 3Y-10.56%
PM growth 5YN/A
GM growth 3Y3.02%
GM growth 5Y2.79%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so TEL is creating value.
The number of shares outstanding for TEL has been reduced compared to 1 year ago.
The number of shares outstanding for TEL has been reduced compared to 5 years ago.
TEL has a worse debt/assets ratio than last year.
2.2 Solvency
TEL has an Altman-Z score of 5.58. This indicates that TEL is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of TEL (5.58) is better than 71.77% of its industry peers.
The Debt to FCF ratio of TEL is 1.78, which is an excellent value as it means it would take TEL, only 1.78 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.78, TEL is in the better half of the industry, outperforming 77.42% of the companies in the same industry.
A Debt/Equity ratio of 0.38 indicates that TEL is not too dependend on debt financing.
TEL has a worse Debt to Equity ratio (0.38) than 64.52% of its industry peers.
Even though the debt/equity ratio score it not favorable for TEL, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 1.78 | ||
| Altman-Z | 5.58 |
ROIC/WACC1.88
WACC7.14%
2.3 Liquidity
A Current Ratio of 1.56 indicates that TEL should not have too much problems paying its short term obligations.
TEL has a Current ratio of 1.56. This is in the lower half of the industry: TEL underperforms 71.77% of its industry peers.
TEL has a Quick Ratio of 1.03. This is a normal value and indicates that TEL is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of TEL (1.03) is worse than 75.81% of its industry peers.
The current and quick ratio evaluation for TEL is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.56 | ||
| Quick Ratio | 1.03 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 15.87% over the past year.
Measured over the past years, TEL shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.56% on average per year.
The Revenue has grown by 8.94% in the past year. This is quite good.
Measured over the past years, TEL shows a small growth in Revenue. The Revenue has been growing by 7.24% on average per year.
EPS 1Y (TTM)15.87%
EPS 3Y6.22%
EPS 5Y15.56%
EPS Q2Q%25.13%
Revenue 1Y (TTM)8.94%
Revenue growth 3Y1.97%
Revenue growth 5Y7.24%
Sales Q2Q%16.74%
3.2 Future
Based on estimates for the next years, TEL will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.20% on average per year.
TEL is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.90% yearly.
EPS Next Y20.69%
EPS Next 2Y15.73%
EPS Next 3Y14.96%
EPS Next 5Y14.2%
Revenue Next Year11.27%
Revenue Next 2Y9.01%
Revenue Next 3Y8.69%
Revenue Next 5Y8.9%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
TEL is valuated quite expensively with a Price/Earnings ratio of 28.42.
Based on the Price/Earnings ratio, TEL is valued a bit cheaper than the industry average as 66.94% of the companies are valued more expensively.
TEL is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.13, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 23.55, the valuation of TEL can be described as rather expensive.
Based on the Price/Forward Earnings ratio, TEL is valued a bit cheaper than 64.52% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of TEL to the average of the S&P500 Index (22.35), we can say TEL is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.42 | ||
| Fwd PE | 23.55 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TEL indicates a somewhat cheap valuation: TEL is cheaper than 64.52% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, TEL is valued a bit cheaper than 79.03% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.97 | ||
| EV/EBITDA | 18.48 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
TEL has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as TEL's earnings are expected to grow with 14.96% in the coming years.
PEG (NY)1.37
PEG (5Y)1.83
EPS Next 2Y15.73%
EPS Next 3Y14.96%
5. Dividend
5.1 Amount
TEL has a Yearly Dividend Yield of 1.14%. Purely for dividend investing, there may be better candidates out there.
TEL's Dividend Yield is rather good when compared to the industry average which is at 2.07. TEL pays more dividend than 87.90% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.39, TEL's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.14% |
5.2 History
On average, the dividend of TEL grows each year by 7.56%, which is quite nice.
TEL has been paying a dividend for at least 10 years, so it has a reliable track record.
TEL has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)7.56%
Div Incr Years14
Div Non Decr Years17
5.3 Sustainability
TEL pays out 43.59% of its income as dividend. This is a bit on the high side, but may be sustainable.
TEL's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP43.59%
EPS Next 2Y15.73%
EPS Next 3Y14.96%
249
+5.45 (+2.24%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryElectronic Equipment, Instruments & Components
Earnings (Last)
Earnings (Next)
Inst Owners95.21%
Inst Owner Change-0.25%
Ins Owners0.12%
Ins Owner Change-0.55%
Market Cap73.57B
Revenue(TTM)17.26B
Net Income(TTM)1.84B
Analysts79.2
Price Target234.14 (-5.97%)
Short Float %1.37%
Short Ratio2.47
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.14% |
Yearly Dividend2.7
Dividend Growth(5Y)7.56%
DP43.59%
Div Incr Years14
Div Non Decr Years17
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.07%
Min EPS beat(2)5.72%
Max EPS beat(2)8.43%
EPS beat(4)4
Avg EPS beat(4)5.56%
Min EPS beat(4)2.19%
Max EPS beat(4)8.43%
EPS beat(8)7
Avg EPS beat(8)3.79%
EPS beat(12)11
Avg EPS beat(12)3.34%
EPS beat(16)14
Avg EPS beat(16)3.67%
Revenue beat(2)2
Avg Revenue beat(2)3.29%
Min Revenue beat(2)2.57%
Max Revenue beat(2)4.01%
Revenue beat(4)3
Avg Revenue beat(4)1.8%
Min Revenue beat(4)-2.74%
Max Revenue beat(4)4.01%
Revenue beat(8)4
Avg Revenue beat(8)0.37%
Revenue beat(12)6
Avg Revenue beat(12)0.54%
Revenue beat(16)10
Avg Revenue beat(16)1.17%
PT rev (1m)5.68%
PT rev (3m)28.19%
EPS NQ rev (1m)0.29%
EPS NQ rev (3m)0.92%
EPS NY rev (1m)0.96%
EPS NY rev (3m)7.33%
Revenue NQ rev (1m)0.07%
Revenue NQ rev (3m)0.6%
Revenue NY rev (1m)0.18%
Revenue NY rev (3m)1.09%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.42 | ||
| Fwd PE | 23.55 | ||
| P/S | 4.26 | ||
| P/FCF | 22.97 | ||
| P/OCF | 17.78 | ||
| P/B | 5.85 | ||
| P/tB | 22.76 | ||
| EV/EBITDA | 18.48 |
EPS(TTM)8.76
EY3.52%
EPS(NY)10.57
Fwd EY4.25%
FCF(TTM)10.84
FCFY4.35%
OCF(TTM)14.01
OCFY5.63%
SpS58.42
BVpS42.59
TBVpS10.94
PEG (NY)1.37
PEG (5Y)1.83
Graham Number91.62
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.34% | ||
| ROE | 14.64% | ||
| ROCE | 16.95% | ||
| ROIC | 13.39% | ||
| ROICexc | 14.29% | ||
| ROICexgc | 28.58% | ||
| OM | 19.6% | ||
| PM (TTM) | 10.67% | ||
| GM | 35.22% | ||
| FCFM | 18.56% |
ROA(3y)10.04%
ROA(5y)10.47%
ROE(3y)19.01%
ROE(5y)20.15%
ROIC(3y)12.89%
ROIC(5y)13.15%
ROICexc(3y)13.97%
ROICexc(5y)14.2%
ROICexgc(3y)25.41%
ROICexgc(5y)25.74%
ROCE(3y)16.32%
ROCE(5y)16.64%
ROICexgc growth 3Y1.55%
ROICexgc growth 5Y10.25%
ROICexc growth 3Y-2.52%
ROICexc growth 5Y8.84%
OM growth 3Y2.75%
OM growth 5Y6.64%
PM growth 3Y-10.56%
PM growth 5YN/A
GM growth 3Y3.02%
GM growth 5Y2.79%
F-Score5
Asset Turnover0.69
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 1.78 | ||
| Debt/EBITDA | 1.15 | ||
| Cap/Depr | 111.7% | ||
| Cap/Sales | 5.42% | ||
| Interest Coverage | 99.53 | ||
| Cash Conversion | 98.03% | ||
| Profit Quality | 173.89% | ||
| Current Ratio | 1.56 | ||
| Quick Ratio | 1.03 | ||
| Altman-Z | 5.58 |
F-Score5
WACC7.14%
ROIC/WACC1.88
Cap/Depr(3y)95.4%
Cap/Depr(5y)94.75%
Cap/Sales(3y)4.76%
Cap/Sales(5y)4.72%
Profit Quality(3y)129.05%
Profit Quality(5y)109%
High Growth Momentum
Growth
EPS 1Y (TTM)15.87%
EPS 3Y6.22%
EPS 5Y15.56%
EPS Q2Q%25.13%
EPS Next Y20.69%
EPS Next 2Y15.73%
EPS Next 3Y14.96%
EPS Next 5Y14.2%
Revenue 1Y (TTM)8.94%
Revenue growth 3Y1.97%
Revenue growth 5Y7.24%
Sales Q2Q%16.74%
Revenue Next Year11.27%
Revenue Next 2Y9.01%
Revenue Next 3Y8.69%
Revenue Next 5Y8.9%
EBIT growth 1Y13.44%
EBIT growth 3Y4.78%
EBIT growth 5Y14.36%
EBIT Next Year38.9%
EBIT Next 3Y20.67%
EBIT Next 5Y16.38%
FCF growth 1Y14.52%
FCF growth 3Y23.51%
FCF growth 5Y17.47%
OCF growth 1Y19.04%
OCF growth 3Y18.81%
OCF growth 5Y15.75%
TE CONNECTIVITY PLC / TEL FAQ
Can you provide the ChartMill fundamental rating for TE CONNECTIVITY PLC?
ChartMill assigns a fundamental rating of 7 / 10 to TEL.
What is the valuation status of TE CONNECTIVITY PLC (TEL) stock?
ChartMill assigns a valuation rating of 5 / 10 to TE CONNECTIVITY PLC (TEL). This can be considered as Fairly Valued.
Can you provide the profitability details for TE CONNECTIVITY PLC?
TE CONNECTIVITY PLC (TEL) has a profitability rating of 8 / 10.
Can you provide the PE and PB ratios for TEL stock?
The Price/Earnings (PE) ratio for TE CONNECTIVITY PLC (TEL) is 28.42 and the Price/Book (PB) ratio is 5.85.
Can you provide the expected EPS growth for TEL stock?
The Earnings per Share (EPS) of TE CONNECTIVITY PLC (TEL) is expected to grow by 20.69% in the next year.