No Drama Downgrade. Shifting to In Line.

研报英文原文证据摘录

No Drama Downgrade. Shifting to In Line.

Technology | IT Hardware & Networking

June 21, 2026

TE Connectivity Ltd. Amit Daryanani Irvin Liu 415-800-0185 415-800-0183

TEL | $217.64 amit.daryanani@evercoreisi.com irvin.liu@evercoreisi.com

In Line (from Outperform) | Target Price/Base Case: Hannah Liu Victor Santiago

$230.00 (from $260.00) 212-812-2905 212-653-9014

Change in Recommendation hannah.liu@evercoreISI.com Victor.Santiago@evercoreISI.com

Company Statistics No Drama Downgrade. Shifting to In Line.

Market Capitalization (M) $62,640 ALL YOU NEED TO KNOW: We are downgrading TEL to In Line from

Shares Outstanding (M) 297 Outperform, driven by our view that current valuation (~17.3x FTM P/E

Float (M) 292 vs. 5-year avg of ~18x) adequately reflects the attractive LT potential

Average 10-Day Volume (M) 2,778

vs. potential near-term uncertainty. While we remain constructive on the Enterprise Value (M) $62,237

52-Week Range $162.17 - $252.56 structural growth drivers (AI, energy, industrial mix shift), we see a less

Fiscal Year End Sep favorable 12-month risk/reward. Key points include: 1) AI DC Scaling—

the Bright Spot, but Still Small: This business reached ~$1.4B in 2025

and is expected to exceed $3B, although AI remains a small portion of

Earnings Summary overall revenue (~12-13% in FY25). The near-term debate is AI trends

have looked flattish for a couple of quarters and if AI can inflect from

2025 2026E 2027E

~$480M in the Mar-qtr toward >$700M/quarter exiting FY26. 2) Secular

Revenue (M) Q1 $3,836 $4,669A $4,778 Energy Tailwinds: Energy is an underappreciated grower. Richards

Q2 $4,143 $4,744A $5,106

Q3 $4,534 $5,000 $5,371 (~$400M annual sales at high-30s% EBITDA margin) lifts both growth