Back to top

Image: Bigstock

Investing in TE Connectivity (TEL)? Don't Miss Assessing Its International Revenue Trends

Read MoreHide Full Article

Have you looked into how TE Connectivity (TEL - Free Report) performed internationally during the quarter ending September 2024? Considering the widespread global presence of this electronics maker, examining the trends in international revenues is essential for assessing its financial resilience and prospects for growth.

In the modern, closely-knit global economic landscape, the capacity of a business to access foreign markets is often a key determinant of its financial well-being and growth path. Investors now place great importance on grasping the extent of a company's dependence on international markets, as it sheds light on the firm's earnings stability, its skill in leveraging various economic cycles and its broad growth potential.

Being present in international markets serves as a counterbalance to domestic economic challenges while offering chances to engage with more rapidly evolving economies. However, this kind of diversification introduces challenges like currency fluctuations, geopolitical uncertainties and varying market trends.

Upon examining TEL's recent quarterly performance, we noticed several interesting patterns in the revenue generated from its international segments, which are commonly analyzed and observed by Wall Street experts.

The company's total revenue for the quarter stood at $4.07 billion, increasing 0.8% year over year. Now, let's delve into TEL's international revenue breakdown to gain insights into the significance of its operations beyond home turf.

A Dive into TEL's International Revenue Trends

During the quarter, Asia-Pacific contributed $1.4 billion in revenue, making up 34.37% of the total revenue. When compared to the consensus estimate of $1.32 billion, this meant a surprise of +5.98%. Looking back, Asia-Pacific contributed $1.33 billion, or 33.50%, in the previous quarter, and $1.24 billion, or 30.61%, in the same quarter of the previous year.

Of the total revenue, $1.47 billion came from EMEA during the last fiscal quarter, accounting for 36.14%. This represented a surprise of -3.75% as analysts had expected the region to contribute $1.53 billion to the total revenue. In comparison, the region contributed $1.47 billion, or 36.84%, and $1.61 billion, or 39.78%, to total revenue in the previous and year-ago quarters, respectively.

Anticipated Revenues in Overseas Markets

The current fiscal quarter's total revenue for TE Connectivity, as projected by Wall Street analysts, is expected to reach $3.9 billion, reflecting an increase of 1.9% from the same quarter last year. The breakdown of this revenue by foreign region is as follows: Asia-Pacific is anticipated to contribute 33.9% or $1.32 billion and EMEA 38.1% or $1.49 billion.

For the full year, a total revenue of $16.53 billion is expected for the company, reflecting an increase of 4.3% from the year before. The revenues from Asia-Pacific and EMEA are expected to make up 33% and 37.6% of this total, corresponding to $5.46 billion and $6.22 billion respectively.

Wrapping Up

The dependency of TE Connectivity on global markets for its revenues presents a mix of potential gains and hazards. Thus, monitoring the trends in its overseas revenues can be a key indicator for predicting the firm's future performance.

In an era of growing international ties and escalating geopolitical disputes, financial analysts on Wall Street pay keen attention to these developments to fine-tune their earnings estimations for businesses operating across borders. It's important to note, however, that a range of additional variables, like a company's local market status, also play a crucial role in shaping these forecasts.

At Zacks, a company's changing earnings outlook is given considerable attention due to its proven, strong influence on a stock's price performance in the near term. The connection here is straightforward and positive: when earnings estimates are revised upward, the stock price generally follows suit, increasing as well.

The Zacks Rank, our proprietary stock rating tool, comes with an externally validated impressive track record. It effectively utilizes shifts in earnings projections to act as a dependable barometer for forecasting short-term stock price trends.

At the moment, TE Connectivity has a Zacks Rank #3 (Hold), signifying that its performance may align with the overall market trend in the upcoming period. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Examining the Latest Trends in TE Connectivity's Stock Value

The stock has witnessed an increase of 4.8% over the past month versus the Zacks S&P 500 composite's an increase of 3%. In the same interval, the Zacks Computer and Technology sector, to which TE Connectivity belongs, has registered an increase of 3.6%. Over the past three months, the company's shares saw an increase of 2.2%, while the S&P 500 increased by 12.3%. In comparison, the sector experienced an increase of 12.4% during this timeframe.

See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


TE Connectivity Ltd. (TEL) - free report >>

Published in