TE Connectivity heads into early May with a stock that has recovered some post-earnings ground, while short sellers quietly rebuild positions and analysts digest a quarter that underwhelmed on datacenter exposure.
The sharpest story of the past two weeks was the earnings reaction. TEL fell 10.5% on April 22 and shed another 15.6% over the following five days — an unusually punishing response by recent standards. The market's verdict centred on the bear case: diminished opportunity in the datacenter and AI infrastructure cycle, flat revenue growth, and questions about reliance on a handful of large hyperscalers. Since then the stock has clawed back 1.3% on the week to $206.94, though it remains roughly 1% lower over the past month.
Short sellers have not stepped away cleanly. Short interest dipped modestly on the week — down 0.4% — but is up 10.7% over the past month, reaching 2.7% of free float. That figure is not extreme in isolation, but the direction matters: bears built positions as the stock was falling and have kept most of them on. The ORTEX short score of 34.4 reflects a middling rather than crowded setup. Borrow costs tell the same story — the cost to borrow has eased sharply, down roughly 48% on the week to 0.39%, and availability remains ample. There is no squeeze pressure here; bears have comfortable access to stock.
Options positioning has turned notably more neutral than it was through the heart of the April selldown. The put/call ratio eased to 1.61 — below its 20-day mean of 1.78 — compared with readings above 2.4 when the tariff-driven market stress peaked in early April. The PCR z-score of -0.44 confirms that downside hedging is below recent norms. Taken together, the lending and options picture reads as a market that has largely repriced the bad news rather than one bracing for the next leg lower.
The Street's response to the print was mixed in direction but almost uniform in tone: cautious. Most recent analyst actions were target cuts, with the modal view being that the Q2 results were a setback rather than a structural break. Barclays maintained Overweight but trimmed to $297. UBS kept Buy while cutting to $261. Goldman Sachs had already moved ahead of earnings on April 14, lowering its target from $306 to $270 while holding Buy. On the negative side, HSBC downgraded to Hold and initiated with a $234 target — the clearest statement that near-term valuation is constrained. The mean analyst target sits at $264, implying roughly 27% upside from current levels, though a cluster of Hold-rated targets in the $226–$240 range suggests the street is split on how much of that gap is realistically closeable near-term. Valuation multiples confirm a stock that has de-rated: the P/E is running at 17.7x, down from levels implied by the 30-day change, and EV/EBITDA of 12.2x has also compressed slightly over the same window. The 100th-percentile dividend score is the one unambiguously positive factor reading; forward EPS momentum is middling at the 60th percentile on a 30-day basis and softer at the 42nd on a 90-day view.
On the buy side, the bull case rests on stronger bookings in commercial transportation and industrial markets, grid-hardening demand in the US, and resilience in China auto. T. Rowe Price added 427,900 shares in the most recently reported quarter and Columbia Management built a position of over 790,000 shares — both meaningful increments from active managers at a time when passive holders Vanguard (13.2%) and BlackRock (7.7%) barely moved. That active-money accumulation predates the earnings miss, so it is worth monitoring whether those names reduce or hold through the current patch.
The next read on whether the datacenter thesis can recover will come from hyperscaler capex commentary in the weeks ahead — TEL's ability to defend its AI infrastructure exposure against the bear case of flat growth and shrinking opportunity is the question the stock is now being asked to answer.
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