TEL
TE Connectivity Ltd.$211.98
Hold
Target $261.16
Report: Mar 07, 2026Technology • Hardware, Equipment & Parts • Mature CompounderSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$211.98+23.2%
Rec: HoldConviction: High
Entry Target
$200.89
(5% below current)
Fair Value
$261.16
(23% above current)
Stop Loss
$149.63
(29% below current)
Position Size
Half
Time Horizon
Long-Term
Key Metrics
Live Snapshot
Market Data
52 Week High$250.67
52 Week Low$116.30
Avg. 3 Month Volume2.24M
Efficiency
LTM Gross Margin35.7%
LTM EBITDA Margin24.7%
LTM EBIT Margin19.7%
LTM Operating Margin19.3%
LTM ROA8.3%
LTM ROE16.5%
LTM ROIC23.9%
LTM ROCE18.5%
Capital Structure
Market Cap (MM)$61.3B
Enterprise Value (MM)$65.8B
Shares Outstanding294.00M
Total Debt (MM)$5.71B
Cash & Equivalents (MM)$1.25B
LTM Net Debt (MM)$4.46B
LTM Net Debt/EBITDA1.0x
Growth
TTM Rev. Growth14.2%
Last 3-Yr Rev. CAGR3.5%
Last 3-Yr EBITDA CAGR9.6%
Last 3-Yr EPS CAGR-0.1%
Valuation
Street Target Price$272.43
LTM EV/Revenue3.6x
LTM EV/Gross Profit10.2x
LTM EV/EBIT18.5x
LTM EV/EBITDA14.7x
LTM P/E29.7x
LTM EV/FCF20.9x
LTM P/FCF19.5x
LTM P/TB3.8x
LTM P/B4.7x
Dividend Yield1.3%
Payout Ratio39.8%
Executive SummarySituation: Current price is $211.98 versus fair value $261.16 (23.2% expected return), and valuation confidence is stable. Debate: Bull case depends on AI revenue exceeding $1.2 billion in FY2026. Bear case centers on EV transition plateau forcing Transportation Solutions revenue stagnation. Conclusion: Recommendation is Hold with Half sizing and Long-Term horizon.
Bull Case
AI revenue tripling to $900M with 30% plus incremental margins; record 22% operating margins achieved in Q1 FY2026; 100% free cash flow conversion supporting $10.1B in shareholder returns over 5 years.
Bear Case
EV transition plateau impacting the Transportation segment (54% of revenue); significant tax volatility including a $1.4B reversal in FY2025; heavy insider selling totaling $145.8M with zero purchases in the last 12 months.
Key Catalysts
Mid-Term (6-18 months)Impact: High
AI revenue exceeding $1.2 billion in FY2026. This would validate the hidden AI play narrative and likely shift market sentiment toward a hig...
Near-Term (0-6 months)Impact: Moderate
Stabilization of European industrial markets. A return to growth in the Industrial Solutions segment would remove a primary bear case argume...
Long-Term (18+ months)Impact: Moderate
TE Connectivity is currently at a critical juncture where secular AI growth is beginning to decouple its performance from the broader automo...
Primary Risks
Concern: Medium
EV transition plateau forcing Transportation Solutions revenue stagnation. A permanent slowdown in global EV adoption would impair the compa...
Concern: Low
Tax profile volatility impacting net margin stability. As seen in FY2025, the reversal of significant tax benefits can collapse net margins...
Concern: Medium
The governance structure is robust, with a clear separation of Chairman and CEO roles and a board comprised of 75% independent directors. Wh...
Recent Activity
2025-11-20SEC Filing (8-K)
-7.96%Excerpt: (EX-99.1) Exhibit 99.1 2025 The next chapter of value creation Welcome Sujal Shah VP, Investor Relations TE Connectivity 2025 Investor Day Agenda 3 Welcome Next Chapter of TE Industrial Solutions Transportation Solutions...
2025-07-23SEC Filing (8-K)
+11.95%TE Connectivity reports Q3 FY25 results with record sales, earnings, and cash flow
2025-05-10Market Movement
+5.30%Market/Sector Move +5.30%
2025-04-24Market Movement
+5.48%Market/Sector Move +5.48%
2024-01-24SEC Filing (8-K)
+6.67%TE Connectivity reports Q1 FY24 results with record cash flow and margin expansion
Valuation Table
9.8/10Decision Grade
Scenario Range
$150
Bear
$276
Bull
$212