On Thursday, TE Connectivity (NYSE:TEL) shares saw its price target raised by Jefferies from $180.00 to $190.00, with the firm maintaining a Buy rating on the stock.
This adjustment reflects Jefferies' anticipation of the company's earnings surpassing both the consensus expectations and the company's own guidance for the third quarter of fiscal year 2024, targeting approximately $1.85 per share.
Jefferies' outlook is influenced by recent adjustments in global automotive forecasts. Notably, IHS Markit has revised its full-year 2024 light vehicle production forecast, projecting a 2% decline. However, a rebound is expected with an estimated growth of about 3% for the years 2025 and 2026.
The firm also forecasts a recovery in the demand for Industrial Equipment, which is expected to contribute to TE Connectivity's growth. Jefferies predicts a turning point in growth beginning in the first quarter of fiscal year 2025, suggesting a positive outlook for the company's performance in the industrial sector.
TE Connectivity, which specializes in technology and manufacturing in various sectors including automotive and industrial equipment, is positioned to benefit from these market dynamics according to Jefferies. The firm's raised price target and sustained Buy rating indicate confidence in the company's ability to capitalize on the anticipated market trends.
Investors and market watchers will be keeping a close eye on TE Connectivity's upcoming financial reports to see if the company's performance aligns with Jefferies' projections. The new price target of $190.00 offers a glimpse into the firm's expectations for TE Connectivity's growth trajectory over the next few fiscal quarters.
In other recent news, TE Connectivity has seen shifts in its share target from multiple analysts. BofA Securities increased its price target to $170, citing the company's ability to grow its content per vehicle and maintain overall growth. The firm also anticipates TE Connectivity's fiscal third-quarter earnings to report revenues of $4.0 billion and earnings per share of $1.85.
Baird has adjusted its price target down to $162, anticipating a quarter similar to the previous one, where TE Connectivity met expectations but issued lower forward guidance.
Evercore ISI maintained an Outperform rating, suggesting that divesting TE Connectivity's medical business could benefit the company strategically. The firm later increased its price target to $175, citing growth prospects in AI and EV markets.
These are recent developments for TE Connectivity, with analysts from BofA Securities, Baird, and Evercore ISI providing their projections. Investors will be closely monitoring the company's financial performance and strategic decisions in the future, particularly the upcoming third-quarter earnings report and potential developments in AI and EV markets.
InvestingPro Insights
TE Connectivity (NYSE:TEL) appears poised for steady performance, underscored by a remarkable history of raising its dividend for 14 consecutive years, which aligns with Jefferies' optimistic projections. The company's current P/E ratio of 14.59, which is attractive relative to its near-term earnings growth, suggests that the stock could be undervalued. Additionally, TEL's moderate level of debt and capability to cover interest payments comfortably with its cash flows provide a layer of financial stability.
InvestingPro data shows that TE Connectivity is trading near its 52-week high, with a price percentage of 98.31% of the high, reflecting market confidence. The firm's dividend yield stands at 1.66%, with a notable dividend growth of 10.17% over the last twelve months as of Q2 2024. Moreover, the company's one-year price total return of 12.1% indicates solid investor returns.
For those looking to delve deeper into TE Connectivity's financial health and future prospects, InvestingPro offers additional insights and metrics. There are 9 more InvestingPro Tips available for TEL, which can be accessed by visiting https://www.investing.com/pro/TEL. Investors interested in leveraging these insights can use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, providing a comprehensive toolset for informed investment decisions.
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