Key Stats for TEL Stock
- 6-Month Performance: 11%
- 52-Week Range: $116 to $251
- Valuation Model Target Price: $275
- Implied Upside: 20%
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What Happened?
TE Connectivity stock is up about 11% over the last 6 months, recently trading near $230 per share, as investors reacted to accelerating AI infrastructure demand, record orders, and expanding margins.
The move reflects growing confidence that data center connectivity, energy infrastructure investment, and rising content per vehicle can drive stronger earnings growth in fiscal 2026.
The stock climbed following record first quarter fiscal 2026 results that reinforced this thesis. Sales reached $4.7 billion, up 22% year over year and 15% organically, while orders rose to a record $5.1 billion with a 1.1 book-to-bill ratio, signaling sustained demand momentum.
Adjusted EPS increased 33% to a record $2.72 and adjusted operating margin expanded to 22.2%, as CEO Terrence Curtin said the company “delivered over 20% sales growth in the first quarter,” supported by 70% growth in digital data networks and a $200 million increase to its fiscal 2026 AI revenue outlook.
Recent SEC filings showed meaningful institutional repositioning. Kovitz Investment Group reduced its stake by 32%, Tredje AP fonden cut its position by 89.5%, Pzena Investment Management trimmed 21.9%, and Thrivent Financial reduced exposure by 96.1%.
Offsetting those moves, Bowen Hanes & Co. initiated a new 195,000-share position valued at about $42.8 million, NEOS Investment Management increased its stake by 45.5%, Lansforsakringar Fondforvaltning AB raised its holdings by 4.9%, and NewEdge Wealth increased its position by 21.3%, while institutional ownership remains elevated at 91.43%.
Insider activity also drew attention. SVP Reuben Shaffer sold 1,425 shares at $234.23 and Shadrak Kroeger sold 9,400 shares at $233.82 in transactions totaling more than $2.5 million.
While these transactions do not alter the company’s financial trajectory, they occurred as shares approached the upper end of their range, contributing to more measured trading despite strong operational momentum.
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Is TEL Undervalued?
Under valuation assumptions, the stock is modeled using:
- Revenue Growth (CAGR): 9%
- Operating Margins: 22.6%
- Exit P/E Multiple: 19.2x
Revenue is projected to grow from roughly $19.4 billion in fiscal 2026 to about $26.1 billion by 2030, driven by higher AI-related data connectivity demand, grid modernization spending, aerospace backlog strength, and increased electronic content per vehicle.
Margin expansion toward the low 20% range reflects mix shift into higher value digital data networks, energy solutions, and aerospace applications, where incremental margins tend to be structurally stronger.
Based on these inputs, the model supports a valuation modestly above current levels, implying roughly 20% upside from around $230 per share, indicating the stock appears undervalued at today’s price.
AI infrastructure remains a central growth engine. Orders in digital data networks rose 70% year over year, and management increased its fiscal 2026 AI revenue outlook by $200 million, with growth expected across hyperscale customers.
Automotive content growth tied to electrification and data connectivity continues to outpace underlying vehicle production, while energy investments tied to grid hardening and renewables provide durable tailwinds.
At current levels, TE Connectivity appears modestly undervalued, with 2026 performance likely driven by sustained AI program ramps, operating leverage from volume growth, and continued margin expansion rather than a cyclical rebound.
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How Much Upside Does TE Connectivity Have From Here?
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All it takes is three simple inputs:
- Revenue Growth
- Operating Margins
- Exit P/E Multiple
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