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For third quarter fiscal 2024, TE Connectivity expects net sales of $4 billion with year-over-year organic growth driven by the Transportation and Communications segments. The Zacks Consensus Estimate for revenues is pegged at $4.01 billion, suggesting 4.8% year-over-year growth.
Adjusted earnings are projected at $1.85 per share, indicating growth of 5% year over year. The consensus mark for fiscal third-quarter earnings has remained unchanged at $1.86 per share in the past 30 days, suggesting year-over-year growth of 5.08%.
TE Connectivity beat the Zacks Consensus Estimate for earnings in all the trailing four quarters, the average surprise being 4.10%.
Let’s see how things have shaped up for the upcoming announcement:
Factors to Note
TE Connectivity’s fiscal third quarter performance is expected to have benefited from the well-performing transportation solutions segment. The growing proliferation of EVs and strong content trends in electronification is expected to have driven automotive sales.
The company’s auto business is expected to have witnessed consistent growth despite some regional challenges. With global auto production expected to remain around 21 million units per quarter and EV and hybrid production set to increase by 24%, TEL is well-positioned to benefit from the increasing content per vehicle in the electrification and electronification of the automotive sector.
The Communication segment is expected to have returned to year-over-year growth in the third quarter of fiscal 2024, driven by the end of destocking trends and rising momentum in high-speed cloud and AI applications. The significant increase in AI-related orders, particularly in data center programs, is anticipated to have further boosted this segment’s performance.
Improvements in commercial aerospace and solid momentum across renewable energy across solar and wind applications are expected to have driven the performance of industrial solutions. Additionally, growing momentum across interventional procedures is likely to have aided medical sales.
TE Connectivity observed improved order levels in second quarter of fiscal 2024, with sequential growth in all segments. Orders were up 6% sequentially to $4 billion, the highest in a year and a half. The increased order levels, particularly in the Communications and Industrial segments, are expected to have reflected stability and momentum across its end markets.
However, declining sensor sales due to portfolio optimization activities are likely to have been a headwind. Further, sluggish commercial transportation and data and device sales might have been a major concern.
What Our Model Says
Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That’s the exact case here.
TE Connectivity currently has an Earnings ESP of +0.87% and a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks to Consider
Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:
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TE Connectivity (TEL) Set to Post Q3 Earnings: What's in Store?
TE Connectivity (TEL - Free Report) is scheduled to report its third-quarter fiscal 2024 results on Jul 24.
For third quarter fiscal 2024, TE Connectivity expects net sales of $4 billion with year-over-year organic growth driven by the Transportation and Communications segments. The Zacks Consensus Estimate for revenues is pegged at $4.01 billion, suggesting 4.8% year-over-year growth.
Adjusted earnings are projected at $1.85 per share, indicating growth of 5% year over year. The consensus mark for fiscal third-quarter earnings has remained unchanged at $1.86 per share in the past 30 days, suggesting year-over-year growth of 5.08%.
TE Connectivity beat the Zacks Consensus Estimate for earnings in all the trailing four quarters, the average surprise being 4.10%.
TE Connectivity Ltd. Price and EPS Surprise
TE Connectivity Ltd. price-eps-surprise | TE Connectivity Ltd. Quote
Let’s see how things have shaped up for the upcoming announcement:
Factors to Note
TE Connectivity’s fiscal third quarter performance is expected to have benefited from the well-performing transportation solutions segment. The growing proliferation of EVs and strong content trends in electronification is expected to have driven automotive sales.
The company’s auto business is expected to have witnessed consistent growth despite some regional challenges. With global auto production expected to remain around 21 million units per quarter and EV and hybrid production set to increase by 24%, TEL is well-positioned to benefit from the increasing content per vehicle in the electrification and electronification of the automotive sector.
The Communication segment is expected to have returned to year-over-year growth in the third quarter of fiscal 2024, driven by the end of destocking trends and rising momentum in high-speed cloud and AI applications. The significant increase in AI-related orders, particularly in data center programs, is anticipated to have further boosted this segment’s performance.
Improvements in commercial aerospace and solid momentum across renewable energy across solar and wind applications are expected to have driven the performance of industrial solutions. Additionally, growing momentum across interventional procedures is likely to have aided medical sales.
TE Connectivity observed improved order levels in second quarter of fiscal 2024, with sequential growth in all segments. Orders were up 6% sequentially to $4 billion, the highest in a year and a half. The increased order levels, particularly in the Communications and Industrial segments, are expected to have reflected stability and momentum across its end markets.
However, declining sensor sales due to portfolio optimization activities are likely to have been a headwind. Further, sluggish commercial transportation and data and device sales might have been a major concern.
What Our Model Says
Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That’s the exact case here.
TE Connectivity currently has an Earnings ESP of +0.87% and a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks to Consider
Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:
Arista Networks (ANET - Free Report) has an Earnings ESP of +0.95% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Arista Networks’ shares have gained 40.4% year to date. ANET is set to report its second-quarter 2024 results on Jul 30.
Meta Platforms (META - Free Report) has an Earnings ESP of +1.35% and a Zacks Rank of #3 at present.
Meta Platforms’ shares have gained 34.7% year to date. META is set to report its second-quarter 2024 results on Jul 31.
GoDaddy (GDDY - Free Report) has an Earnings ESP of +13.08% and a Zacks Rank #3.
GoDaddy’s shares have gained 36.8% year to date. GDDY is set to report its second-quarter 2024 results on Aug 1.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.