TE Connectivity Earnings: Below Analysts’ Estimates

TE Connectivity Ltd. (NYSE:TEL) reported its results for the third quarter. TE Connectivity is a provider of engineered electronic components, network solutions, specialty products and communication systems.

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TE Connectivity Ltd. Earnings Cheat Sheet

Results: Net income for TE Connectivity Ltd. fell to $199 million (46 cents per share) vs. $355 million (80 cents per share) a year earlier. This is a decline of 43.9% from the year-earlier quarter.

Revenue: Fell 2.2% to $3.5 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: TE Connectivity Ltd. fell short of the mean analyst estimate of 79 cents per share. Analysts were expecting revenue of $3.56 billion.

Quoting Management: “We executed well in Q3 delivering EPS at our guidance level, increasing adjusted operating margins to 14% and generating free cash flow of $414 million,” said TE Connectivity Chief Executive Officer Tom Lynch. “Sales were up 8% sequentially although slightly below our expectations due to a weaker Euro and softness in our Network Solutions segment. Based on current order trends, we expect fourth quarter sales of approximately $3.4 billion with adjusted operating margins holding around 14%. We expect to generate in excess of $1.3 billion of free cash flow in fiscal 2012 and plan to restart our share repurchase program in the fourth quarter.”

Key Stats:

The company fell short of estimates last quarter after beating the mark the quarter before with net income of 68 cents versus a mean estimate of net income of 65 cents per share.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 86 cents a share to 80 cents over the last ninety days. For the fiscal year, the average estimate has moved down from $2.99 a share to $2.89 over the last ninety days.

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

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