TE Connectivity Ltd. (NYSE:TEL)

The chief fear among all the analysts is that their business is cyclical, much of the market believes this is going to be a down cycle which has provided a buying opportunity. It's Debt to equity is low (0.36) and keeps plenty of cash on hand to deal with short term hickups. With a Gross margin of 36.1% and a net profit margin 10.7% it's likely the exposure to the Auto industry and the "cyclical nature" which has suppressed the price. Beyond all this, it has a pleasant dividend.

Nice price to Cash flow, nice price to projected earnings, nice P/E, appropriate Price to book, but with lower earnings & sales growth than competitors.

The Graph looks pretty good: volume peaked with the sell offs and is now down in the trough, however volume is also down with positive movement. While there are still more up days then down, the down days have higher volume making the up days just barely win. Especially with the highlight of the Motley Fool article today, momentum could easily pick up. ~24.82 would probably be a great price, and it's currently trading for 25.5. A minimum expected value would be ~27 for the coming year, but possibly into the 30s.

Revenue was down in 2009, but that's to be expected for this sort of company. Despite that the balance sheet remained strong, and they've been retiring their debt and doing share buy backs. They recently inked the acquisition of ADC Telecommunications Inc which was doing pretty well itself and should help offset equipment costs and consolidate business.

All in all I think there is a relative discount here, I like the telecommunications/connectivity play and the fact that they are a little diversified themselves in that field. While they lack the super sexiness of advanced Fiber, they are swimming in the accessible beauty of connectivity infrastructure which includes fiber - except the stuff they provide is in use right now.

Just keep in mind the volatility.

test

4/12 screen #2: percentile and CS

high analyst opinion, value

Nice earnings and dividends. The fundamentals are undeniable and the FPE could be near 10. A director just upped the stake by 1millUSD at the current price.

Stock has bottomed... look for inproved year-over-year earnings reports, surprises to the upside, and cost-cutting

Expanding sucessfully in underdeveloped countries, the last place for telecom to actually continue growth.

oversold

Invesotes fell out of love. At current valuations there is limited downside with an upside potential of 50%+. Solid buisness position within their market.

Spain telephone company that dominates Latin America in phone business, Expect strong growth in their markets to continue. Can you hear me now?

This compay is the leader in its current market. Sell the product, then sell the service that goes with the product what a money maker.

Market is still hesistant and Automotive is too much apart of their revenue mix

Price to book = 1.5, debt/equity = 29%, accelerating growth, recent spin-off from large conglomerate, major player in boring business

Kozlowski's long gone and this Company has been punished much too severely for his wrong doings.

Ugh, somebody told me this one was good . . . and they bought me lunch so I had to add it. Since the spin off it's gonna go gangbusters.

Upon examination of Tyco’s share price, it is readily apparent that the company trades at a considerable discount to competitors – beyond any measure attributable to the common ‘conglomerate discount’. Given this dis-crepancy, one might logically conclude that it is trading at a discount to intrinsicvalue, and that the spin-offs might serve as a long-awaited valuation catalyst. However, such a conclusion ignores perhaps the most critical issue in evaluatingthe Tyco businesses: the company’s severe underinvestment in research and de-velopment. For example, the Tyco Healthcare business (“Covidien”) spent $262 million onR&D in FY2006, which equaled 2.7 percent of its pro forma revenue. By com-parison, competitors in its industry including Beckton, Dickinson & Co., CRBard, and Johnson & Johnson’s consumer medical devices and diagnostics seg-ment, had FY2006 R&D expense that equaled 7.1 percent, 7.3 percent and 7.2percent of sales, respectively. The resulting effect on net income is quite signifi-cant. Covidien’s projected net income for FY2007, assuming R&D spending is maintained at the FY2006 level of 2.7 percent of sales, is $1,612 million. How-ever, if the company’s R&D investment were to equal the competitor average of 7.2 percent of sales, earnings would be reduced 20 percent to $1,289 million.Tyco Electronics and the remaining Tyco International have also invested far less in R&D than their respective competitors. Tyco trades at about 16.7x consensus earnings estimates for 2007, while relevantcompetitors trade at 20x estimates, or higher. However, if alternative estimates that incorporate a comparable level of R&D investment are used, the company’s2007 earnings multiple increases to 21.7x. In summary, the three Tyco entities will be confronted with a most unfavorable scenario with regard to research and development spending. The companiesmight continue to disregard the need for increased R&D spending, and inevitablybe displaced by competitors; alternatively, they can increase spending, and there-by experience a sharp decrease in net income. Neither alternative bodes well for their futures as independent companies.

undervalued

can't see any improvement in this