Key Stats for TE Connectivity Stock
- YTD price change for TE Connectivity stock: -11%
- $TEL Share Price as of May 1: $207
- 52-Week High: $253
- $TEL Stock Price Target: $267
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What Happened?
TE Connectivity (TEL) stock dropped 12% after the company’s Q3 guidance failed to excite investors — despite a strong Q2 earnings report.
The actual Q2 numbers were genuinely good.
- Revenue came in at $4.7 billion, up 15% year-over-year.
- Adjusted EPS hit $2.73, up 24% from the same quarter last year.
- Orders were a record $5.3 billion
- Free cash flow for the first half of the year hit $1.3 billion — also a record.
So what’s the problem? The Q3 guidance.
- Management guided for $5 billion in revenue and
- adjusted EPS of around $2.83.
- When expectations are high, and a company only matches them, the stock often gets punished.
There’s also a margin story worth watching. Management flagged rising input costs, specifically oil-based resins and freight charges.
These are tied to higher energy prices and broader supply chain pressures from the current geopolitical environment.
TE Connectivity has a playbook for managing these costs — pricing adjustments, supply chain optimization — but acknowledged there’s a timing lag between when costs hit and when price increases flow through.
On the bright side, the company raised its full-year AI revenue estimate by $150 million, with the increase entirely in the second half of the year.
That puts their AI-related Digital Data Networks revenue approaching $2.4 billion for fiscal 2026 — a massive number.
Management also noted that orders in April remain strong, with no demand slowdown since the Iran conflict began.
See analysts’ growth forecasts and price targets for TE Connectivity stock (It’s free) >>>
What the Market Is Telling Us About TE Connectivity Stock
The 9% drop in TE Connectivity stock feels more like a valuation reset than a deterioration in the business.
The underlying business is performing well — record orders, double-digit earnings growth, strong cash generation, and a Board-approved 10% dividend increase.
But TE Connectivity stock had likely priced in upside guidance, not in-line guidance. When you’re growing this fast, investors want to see a raise, not a match.
The AI tailwind is real and accelerating. For investors willing to look past one quarter of soft guidance, TE Connectivity stock could be worth a closer look at the current pullback.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
