TE Connectivity Third Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component TE Connectivity (NYSE:TEL) will unveil its latest earnings on Wednesday, July 25, 2012. TE Connectivity is a provider of engineered electronic components, network solutions, specialty products and communication systems.

TE Connectivity Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of 79 cents per share, a rise of 1.3% from the company’s actual earnings in the year-ago quarter. During the past three months, the average estimate has moved down from 80 cents. Between one and three months ago, the average estimate moved down. It has risen from 78 cents during the last month. Analysts are projecting profit to rise by 7.1% versus last year to $2.90.

Past Earnings Performance: The company topped estimates last quarter after missing forecasts the quarter prior. In the second quarter, it reported net income of 68 cents per share against a mean estimate of profit of 65 cents per share. In the first quarter, it missed forecasts by 4 cents.

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A Look Back: In the second quarter, profit fell 14% to $257 million (60 cents a share) from $299 million (67 cents a share) the year earlier, but exceeded analyst expectations. Revenue fell 6.4% to $3.25 billion from $3.47 billion.

Stock Price Performance: Between April 24, 2012 and July 19, 2012, the stock price fell $2 (-5.8%), from $34.50 to $32.50. The stock price saw one of its best stretches over the last year between December 30, 2011 and January 12, 2012, when shares rose for nine straight days, increasing 12.6% (+$3.88) over that span. It saw one of its worst periods between April 26, 2012 and May 18, 2012 when shares fell for 17 straight days, dropping 16.7% (-$6.13) over that span.

Wall St. Revenue Expectations: On average, analysts predict $3.56 billion in revenue this quarter, a decline of 4.6% from the year-ago quarter. Analysts are forecasting total revenue of $13.65 billion for the year, a decline of 4.6% from last year’s revenue of $14.31 billion.

Key Stats:

On the top line, the company is looking to rebound after a revenue drop last quarter. Revenue rose 3.4% in the the first quarter after dropping in the second quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.9 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company improved this liquidity measure from 1.72 in the first quarter to the last quarter driven in part by an increase in current assets. Current assets increased 26.4% to $8.31 billion while liabilities rose by 14.4% to $4.37 billion.

Analyst Ratings: With 10 analysts rating the stock a buy, none rating it a sell and one rating the stock a hold, there are indications of a bullish stance by analysts.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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