# TE Connectivity

_AI-generated trading idea · UNSPECIFIED · TEL_

> Canonical page: https://commonquant.ai/research/for-you/te-connectivity--3f1e3bd4-309f-5a35-a055-6f2a81d06e47

TE Connectivity

## Idea

TE Connectivity

## Advanced Analysis

### Verdict: strong cash machine, but TEL is nowhere near its entry — wait

The verdict is wait: TEL closed at $218.59, about $10.63 above the 50-day EMA at $207.96, with RSI (14) at 72.1 versus the sub-45 condition the entry requires, so none of the pullback-and-recover conditions is close to arming. The strongest point for the trade is the cash machine behind it — free cash flow of $1.15B last fiscal year ranks in the top 2.3% of 832 Information Technology peers, and revenue reached $5.16B in the quarter ended June 26, 2026, up 25.1% sequentially. The strongest point against is the margin erosion in that same quarter: net income fell 12.5% to $748M and net margin compressed 3.5 points to 14.5% even as revenue accelerated, plus delayed insider filings through June 30, 2026 showed roughly $4.0M of net open-market selling across 13 holders. The dividend adds nuance rather than comfort — annual payouts fell 16.5% from $2.54 in 2024 to $2.27 in 2025, though the latest quarterly payment stepped up to $0.78 with an August 21, 2026 ex-date. The trigger itself is far away, and the bounded parameter search the author requested never completed, so no robust optimized setup was established and the original thesis-consistent rules stand. The fact that would flip this verdict toward action: TEL pulling back to the $207–$208 zone with RSI in the mid-40s or lower and then reversing back above the EMA with RSI climbing back over 50 — ideally confirmed by a next earnings report showing margin stabilization rather than another step-down.

#### Conviction score breakdown

Composite score computed by the server from the applicable evidence-tier dimensions.

| Measure | Value |
| --- | ---: |
| Thesis support | 60/100 |
| Trade readiness | 35/100 |
| Risk quality | 50/100 |
| Trigger proximity | 10/100 |
| Fundamentals trend | 55/100 |
| Score | 42/100 |
| Composite Score | 42/100 |
| Evidence Tier | rules\_not\_triggered |

#### Decision scenarios

Bull, base, and bear cases synthesized from the cited evidence tier. Likelihoods are rounded evidence-weighted judgments, not statistically calibrated forecasts.

| Measure | Value |
| --- | ---: |
| Evidence Tier | rules\_not\_triggered |

### Trade now: TEL is a pullback setup with no trigger in sight

Nothing is live in TEL today — this is a wait setup, not a signal. The stock closed at $218.59, which is 5.1% above the 50-day EMA at $207.96, and RSI (14) sits at 72.1 versus the sub-45 condition the entry needs. The idea's entry package is a pullback-and-recover sequence: price first at or below the 50-day EMA with RSI at or below 45, then a reversal where price moves back above that EMA and RSI climbs back over 50. None of those conditions is close — price would need to fall roughly $10.63 just to reach the EMA before the reversal leg could even be evaluated. What "wait" means in practice: no order, no limit ladder; simply track whether TEL pulls back to the $207–$208 zone with RSI in the mid-40s or lower. If the reversal conditions then complete, the risk plan is defined in advance: a hard stop at 2.0% below entry, a first take-profit at 4.0% above entry, and a structural exit if price closes below the second support level at $210. The nearest resistance at $220.29 is the structural ceiling for the first leg. For transparency on evidence scope: a bounded parameter search could not be completed because of a market-data loading gap, so the published thresholds are the thesis-consistent original rules rather than an optimized variant — the plan above simply uses their live levels.

#### TEL price and trigger map

Uses the idea timeframe and keeps price levels on the price axis.

| Measure | Value |
| --- | ---: |
| Ticker | TEL |
| Timeframe | 1d |

### A Cash Machine Resetting to a Support Zone

The bull case for TE Connectivity starts with cash generation. Free cash flow hit $1.15B in the quarter ended September 26, 2025, which puts the stock in the top 2.3% of 832 Information Technology peers. Full-year free cash flow reached $3.2B for the period ended 2025-09-26, up from $2.4B two years earlier, and operating cash flow of $4.1B comfortably funded $271M of capex. For a value-oriented idea, that kind of cash conversion is the raw material the thesis needs. Growth is real, not just cash. Revenue for the quarter ended September 26, 2025 was $4.75B, up 16.7% year over year, placing TEL in roughly the 69th percentile of its sector. The most recent quarter, ended June 26, 2026, then stepped up again to $5.16B, a 25.1% sequential increase. This is not a shrinking industrial getting a…

#### TEL Return on equity

Return on equity trend from CommonQuant fundamentals/XBRL data; +183.8% from first to latest point.

| Measure | Value |
| --- | ---: |
| 2007-09-28 | \-0.04869473499164982% |
| 2008-09-26 | \0.1523525693127427% |
| 2009-06-26 | \-0.010889548861547164% |
| 2009-09-25 | \-0.4666952544311035% |
| 2009-09-25 | \0.013007432818753576% |
| 2009-12-25 | \0.024578450985996% |
| 2010-03-26 | \0.044784914555097234% |
| 2010-06-25 | \0.04858657243816254% |
| 2010-09-24 | \0.1564982973893303% |
| 2010-09-24 | \0.042139614074914865% |
| 2010-12-24 | \0.036108461643275656% |
| 2011-03-25 | \0.04081911262798635% |
| Latest Value | \0.04081911262798635% |
| Change Pct | \183.82654230480156% |
| Ticker | TEL |
| Timeframe | reported periods |

#### TEL Operating margin

Operating margin trend from CommonQuant fundamentals/XBRL data; +138.6% from first to latest point.

| Measure | Value |
| --- | ---: |
| 2007-09-28 | \0.05209161762366789% |
| 2008-06-27 | \0.13617133791644634% |
| 2008-09-26 | \0.11570305433799484% |
| 2008-12-26 | \0.03059343899741983% |
| 2009-03-27 | \-1.6247325631151048% |
| 2009-06-26 | \0.025518341307814992% |
| 2009-09-25 | \-0.33872854914196565% |
| 2009-09-25 | \0.06523350630096368% |
| 2009-12-25 | \0.093015214384509% |
| 2010-03-26 | \0.1345958741968211% |
| 2010-06-25 | \0.1514267185473411% |
| 2010-09-24 | \0.12430442599092544% |
| Latest Value | \0.12430442599092544% |
| Change Pct | \138.62654235265592% |
| Ticker | TEL |
| Timeframe | reported periods |

#### TEL sector percentile check

Ranks TEL against 832 companies in its sector using CommonQuant fundamentals.

| Measure | Value |
| --- | ---: |
| Free cash flow | \97.71634615384616th percentile |
| Operating margin | \89.32146829810901th percentile |
| Gross margin | \30.136986301369863th percentile |
| Revenue growth (YoY) | \68.78483835005575th percentile |
| Ticker | TEL |
| Sector | Information Technology |
| Peer Count | 832 |

### Scores

- **Conviction score breakdown:** 42
- **Thesis support:** 60
- **Trade readiness:** 35
- **Risk quality:** 50
- **Trigger proximity:** 10
- **Fundamentals trend:** 55

### Watch items

- **TEL — Close vs 50-day EMA**
- **TEL — RSI (14)**
- **TEL — Support level 2**
- **TEL — Resistance level 1**
- **TEL — Next dividend ex-date**
- **TEL — Insider net open-market activity**

## Key details

- Symbols: TEL
- Timeframes: 1d
- Tags: \#canonical-demand, \#cluster-version:1, \#direction:unspecified, \#entity-kind:company, \#entity:TE Connectivity plc, \#exchange:NYSE, \#horizon:unspecified, \#intent:research, \#symbol:TEL

## Community

- Upvotes: 0
- Views: 0
- Copies: 0
- Cosigns: 0

## Related

- [TEL trade ideas](https://commonquant.ai/markets/tel)
- [Latest market news](https://commonquant.ai/news)

## About CommonQuant Research

Ideas and Advanced Analysis are generated with fresh, LLM-selected news headlines and grounded in SEC XBRL fundamentals and peer percentiles. Strategies built from these ideas are automatically backtested (over a timeframe-dependent historical window with walk-forward tuning) and stress-tested before they can go live, then monitored against the news hourly while they run.