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TE Connectivity (TEL) to Post Q1 Earnings: What's in Store?

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TE Connectivity Ltd. (TEL - Free Report) is scheduled to report first-quarter fiscal 2020 results on Jan 29.

For the fiscal first quarter, the company anticipates net sales between $3 billion and $3.2 billion. The Zacks Consensus Estimate for revenues is pegged at $3.11 billion, indicating a decline of 7% year over year.

Adjusted earnings are projected between $1.10 and $1.16 per share. The consensus mark for earnings stands at $1.14 per share, suggesting a decline of 11.6% from the year-ago quarter’s reported figure.

Notably, the company has beat estimates in the trailing four quarters by 5.1%, on average.

TE Connectivity Ltd. Price and EPS Surprise

TE Connectivity Ltd. Price and EPS Surprise

TE Connectivity Ltd. price-eps-surprise | TE Connectivity Ltd. Quote

Factors to Consider

Growing traction across aerospace, defense, marine and medical applications is likely to have boosted the adoption rate of TE Connectivity’s industrial solutions in the fiscal first quarter. This, in turn, is expected to have benefited industrial segment revenues.

Further, secular trends in electric vehicles, automation in next-generation aircraft, factory automation and cloud computing are likely have contributed to the company’s fiscal first-quarter performance.

Additionally, growing usage of sensors in industrial and auto applications is likely to have benefited the company. Moreover, the company’s expanding content in engineered solutions is likely to have weighed on the fiscal first-quarter performance.

Furthermore, sustained execution of the company’s strategic plans is likely to get reflected in the fiscal first quarter results.

However, foreign exchange headwinds and weak end-market conditions are likely to have impacted the top line.

Global auto production and broad weakness in commercial transportation market are anticipated to have hurt the Transportation Solutions segment fiscal first-quarter performance.

Further, ongoing inventory destocking in the supply chain is expected to have impacted the performance of Communications Solutions segment in the fiscal first quarter.

What Our Model Says

Our proven model doesn’t conclusively predict an earnings beat for TE Connectivity this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

TE Connectivity has an Earnings ESP of 0.00% and a Zacks Rank #3.

Stocks to Consider

Here are a few stocks that you may consider, as our proven model shows that these have the right combination of elements to post an earnings beat this quarter.

CEVA (CEVA - Free Report) has an Earnings ESP of +27.06% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Silicon Motion Technology Corporation (SIMO - Free Report) has an Earnings ESP of +5.88% and a Zacks Rank #1.

Advanced Energy Industries, Inc. (AEIS - Free Report) has an Earnings ESP of +10.80% and a Zacks Rank #1.

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