Important note

This AI stock analysis for TE Connectivity is not up to date. Creating and accessing our AI stock Analysis (powered by our data and Chat GPT) is only available for our premium users. Sign up to get access today!

TE Connectivity - AI Stock Analysis

Analysis generated June 23, 2024

TE Connectivity Ltd. (NYSE: TEL) is a global technology leader providing connectivity and sensor solutions essential in today’s increasingly connected world. With customers in over 150 countries, TE Connectivity designs and manufactures products at the heart of electronic connections for the world's leading industries including aerospace, automotive, data communications, healthcare, and energy. The company’s solutions facilitate the electric vehicles of today and the automated industries of tomorrow, underscoring its pivotal role in numerous technological advancements.

Fundamental Analysis

The company’s revenue for the last quarter stood at $3.95 billion. This figure represents a 3.54% increase compared to the previous quarter, indicating a short-term growth trajectory. However, it also reflects a 4.64% decrease compared to the same quarter last year, which might be a reason for some investor concern regarding longer-term performance.

Net income for the last quarter was $541 million, showing a significant decrease of 69.99% compared to the previous quarter, signaling potential issues that need addressing. However, the net income saw a 24.94% increase compared to the same quarter last year, which is an encouraging trend for long-term investors.

The EBITDA for the last quarter was $749 million, slightly decreasing by 1.19% from the previous quarter, but showing a strong 24.42% increase year-over-year. This indicates that while there might be some short-term concerns, the company has shown robust profitability growth over the long term.

TE Connectivity's current Price-to-Earnings (P/E) ratio is 13.72. This ratio is generally considered within a normal range, indicating that the stock is neither overvalued nor undervalued at present. However, recent insider selling can be a bearish signal suggesting potential lack of confidence from within the company.

Technical Analysis

TE Connectivity's current stock price is $152.00, representing a 1.33% increase over the past month and a 16.21% rise from a year ago. The positive short-term and long-term price movements suggest a bullish trend.

The Simple Moving Average (SMA10) is currently $150.11, up from the previous $149.97, indicating a potentially upward trend in price movement. However, the Relative Strength Index (RSI) stands at 84.9, suggesting that the stock is in an overbought condition, a traditional bearish indicator that could point toward a price correction.

Alternative Data Analysis

In terms of job postings and employee sentiment, TE Connectivity has 1,400 open positions, a stable number over recent months, indicating that the company is in a stable position employment-wise. Employee business outlook is neutral, suggesting neither significant optimism nor pessimism within the workforce.

Concerning customer acquisition metrics, TE Connectivity’s website has an estimated 1.3 million visitors. However, this number has decreased by 20% in recent months—an alarming trend pointing to potentially declining customer interest. On social media, the company maintains 17,000 Instagram followers with no significant change, and 39,000 Twitter followers, which has seen a 1% decrease recently.

The AltIndex AI score, which predicts stock performance based on various data points including fundamentals, technical, and alternative data, gives TE Connectivity a score of 42, signaling a hold recommendation.

Conclusion and Recommendation

Based on the analysis of TE Connectivity, the company shows a mixed bag of both positive and concerning signals. The short-term increase in revenue and stock price highlights potential for short-term gains, but a decrease in year-over-year revenue and a substantial drop in quarterly net income raises red flags. Insider selling further adds to the concerns.

Technically, the stock is experiencing bullish momentum but the high RSI suggests caution as the stock might be overbought. Alternative data paints a neutral to slightly pessimistic picture with stable job postings but declining web traffic and social media engagement.

Considering the fundamental, technical, and alternative data presented, a prudent recommendation would be to hold TE Connectivity stock. While there are growth potentials, there remain concerns that necessitate a cautious approach. It would be wise to monitor the company's upcoming quarterly results and insider activity closely while reevaluating the investment based on future performance.

Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.