Analyzing TE Connectivity (TEL) and Surge Components (SPRS)

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TE Connectivity (NYSE:TEL) and Surge Components (OTCMKTS:SPRS) are both computer and technology companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, risk, analyst recommendations, profitability, valuation and earnings.

Profitability

This table compares TE Connectivity and Surge Components’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TE Connectivity 20.06% 19.22% 9.89%
Surge Components 2.98% 19.14% 8.37%

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for TE Connectivity and Surge Components, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TE Connectivity 0 4 5 0 2.56
Surge Components 0 0 0 0 N/A

TE Connectivity presently has a consensus target price of $96.88, indicating a potential upside of 20.97%. Given TE Connectivity’s higher possible upside, analysts plainly believe TE Connectivity is more favorable than Surge Components.

Institutional and Insider Ownership

93.3% of TE Connectivity shares are owned by institutional investors. 0.8% of TE Connectivity shares are owned by company insiders. Comparatively, 47.5% of Surge Components shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Volatility & Risk

TE Connectivity has a beta of 1.04, indicating that its share price is 4% more volatile than the S&P 500. Comparatively, Surge Components has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500.

Dividends

TE Connectivity pays an annual dividend of $1.76 per share and has a dividend yield of 2.2%. Surge Components does not pay a dividend. TE Connectivity pays out 31.4% of its earnings in the form of a dividend. TE Connectivity has increased its dividend for 8 consecutive years.

Earnings & Valuation

This table compares TE Connectivity and Surge Components’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
TE Connectivity $13.99 billion 1.94 $2.57 billion $5.61 14.27
Surge Components $29.77 million 0.16 $350,000.00 N/A N/A

TE Connectivity has higher revenue and earnings than Surge Components.

Summary

TE Connectivity beats Surge Components on 12 of the 15 factors compared between the two stocks.

About TE Connectivity

TE Connectivity Ltd., together with its subsidiaries, manufactures and sells connectivity and sensors solutions in Europe, the Middle East, Africa, the Asia–Pacific, and the Americas. The company operates through three segments: Transportation Solutions, Industrial Solutions, and Communications Solutions. The Transportation Solutions segment provides terminals and connector systems and components, sensors, antennas, relays, application tooling, wires, and heat shrink tubing products for use in the automotive, commercial transportation, and sensor markets. The Industrial Solutions segment offers terminals and connector systems and components; heat shrink tubing; relays; and wires and cables for industrial equipment, aerospace, defense, oil and gas, and energy markets. The Communications Solutions segment supplies electronic components, such as terminals and connector systems and components, relays, heat shrink tubing, and antennas for the data and devices, and appliances markets. TE Connectivity Ltd. sells its products to approximately 140 countries primarily through direct selling to manufacturers, as well as through third-party distributors. The company was formerly known as Tyco Electronics Ltd. and changed its name to TE Connectivity Ltd. in March 2011. TE Connectivity Ltd. was incorporated in 2000 and is based in Schaffhausen, Switzerland.

About Surge Components

Surge Components, Inc. supplies electronic products and components in the United States. The company offers capacitors, which are electrical energy storage devices; and discrete components, such as semiconductor rectifiers, transistors, diodes, and circuit protection devices, as well as audible components, including audible transducers, buzzers, speakers, microphones, resonators, alarms, chimes, filters, and discriminators, as well as fuses, printed circuit boards, and switches. These products are used in the electronic circuitry of various products, including automobiles, telecomm, audio, cellular telephones, computers, consumer electronics, garage door openers, household appliances, power supplies, and security equipment. The company sells its products to original equipment manufacturers and distributors through independent sales representatives or organizations in the United States, Canada, China and other Asian countries, South America, and Europe. Surge Components, Inc. was founded in 1981 and is headquartered in Deer Park, New York.

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