TE Connectivity Ltd (NYSE:TEL)., a prominent player in the electronic equipment, instruments & components industry, has announced an increase in its dividend to $0.59, effective December 1, 2023, resulting in an enhanced dividend yield of 1.9%. This comes as no surprise as TE Connectivity has a history of raising its dividend for 13 consecutive years according to InvestingPro Tips. The company's earnings sufficiently cover this dividend, indicating a considerable portion of its profits is being channeled back into growth initiatives.
Analysts forecast a significant 35.4% surge in the company's earnings per share (EPS) over the next year, which could lead to a sustainable payout ratio of 28%. This prediction aligns with TE Connectivity's demonstrated pattern of consistent dividend growth. The firm's annual payments have risen from $0.84 in 2013 to a recent sum of $2.36, marking an impressive 11% annual growth rate.
Over the past five years, TE Connectivity has maintained a robust annual EPS growth rate of 14%, suggesting effective reinvestment and further capacity for dividend increases. This consistent performance underscores the company's commitment to enhancing shareholder value while also investing in its long-term growth strategy.
According to InvestingPro's real-time metrics, TE Connectivity has a market cap of $39.12 billion and a P/E ratio of 19.06. The company's revenue stands at $16.36 billion, with a growth rate of 3.93%. Despite a slight quarterly downturn in revenue growth at -2.42%, the company's gross profit margin remains strong at 31.2%.
InvestingPro Tips also highlights that TE Connectivity operates with a moderate level of debt and its cash flows can sufficiently cover interest payments. This, along with the fact that the company's liquid assets exceed short term obligations, provides a solid financial foundation for the firm.
For more in-depth insights and tips, such as the company's expected net income drop this year, investors can refer to InvestingPro, which offers 12 additional tips on TE Connectivity and other companies.
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