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TE Connectivity (TEL) to Post Q4 Earnings: What's in Store?

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TE Connectivity Ltd. (TEL - Free Report) is set to report fiscal fourth-quarter 2019 results on Oct 30. In the last reported quarter, it delivered a positive earnings surprise of 5.63%.

The company surpassed the Zacks Consensus Estimate in the trailing four quarters, with the average being 5.13%.

Performance in the Last Reported Quarter

TE Connectivity reported fiscal third-quarter 2019 non-GAAP earnings of $1.50 per share, which surpassed the Zacks Consensus Estimate by 8 cents and increased 5.6% from the year-ago period.

However, net sales came in $3.39 billion, down 5.4% from the year-ago quarter. Further, the figure missed the Zacks Consensus Estimate of $3.42 billion.

Let’s see how things have shaped up for this announcement.

TE Connectivity Ltd. Price and EPS Surprise

 

Fiscal Q4 Estimates

For the fiscal fourth quarter, the company expects adjusted earnings in the band of $1.27-$1.33 per share. The Zacks Consensus Estimate for earnings is pegged at $1.31 per share.

The company anticipates net sales in the range of $3.2-$3.3 billion. The Zacks Consensus Estimate for the same is pegged at $3.27 billion.

Factors to Consider

It has been witnessing normalizing seasonal trends in business. Markets like commercial transportation, factory automation and appliances have also been normalizing. This is likely to have continued in the to-be-reported quarter as well.

TE Connectivity’s growing traction in aerospace, defense and medical fields is expected to positively reflect on fiscal Q4 results. Further, the aerospace, defense and marine business is expected to have driven the industrial segment’s performance.

Meanwhile, Transportation Solutions is likely to have benefited from the growing adoption of sensors in industrial and auto applications. Further, content growth in automobile production is expected to have remained a tailwind.

However, currency fluctuations may have been a concern. Also, weak market conditions in China and softness in European Auto may reflect in the upcoming results.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for TE Connectivity this time around. 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 is not the case here as you will see below.

Earnings ESP: The company has an Earnings ESP of +1.15%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Currently, TE Connectivity has a Zacks Rank #4 (Sell).

Stocks That Warrant a Look

Here are a few stocks worth considering as our model shows that these have the right combination of elements to deliver an earnings beat in the upcoming releases.

Advanced Energy Industries, Inc. (AEIS - Free Report) has an Earnings ESP of +4.17% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Advanced Micro Devices, Inc. (AMD - Free Report) has an Earnings ESP of +6.54% and a Zacks Rank of #2.

Apple Inc. (AAPL - Free Report) has an Earnings ESP of +0.04% and a Zacks Rank #3.

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