Nexans vs TE Connectivity Which Should You Buy?

Nexans and TE Connectivity are two leading companies in the electrical and telecommunications industry. Both companies offer a variety of products and services, including cables, connectors, and networking solutions. Investors looking to capitalize on the growth of the industry may consider investing in either Nexans or TE Connectivity stocks. In this comparison, we will analyze the financial performance, market position, and growth potential of both companies to determine which one may be the better investment opportunity.

Nexans or TE Connectivity?

When comparing Nexans and TE Connectivity, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Nexans and TE Connectivity.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Nexans has a dividend yield of 2.25%, while TE Connectivity has a dividend yield of 1.6%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Nexans reports a 5-year dividend growth of 32.13% year and a payout ratio of 32.85%. On the other hand, TE Connectivity reports a 5-year dividend growth of 6.26% year and a payout ratio of 19.22%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Nexans P/E ratio at 8.80 and TE Connectivity's P/E ratio at 11.88. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Nexans P/B ratio is 1.50 while TE Connectivity's P/B ratio is 3.80.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Nexans has seen a 5-year revenue growth of 1.38%, while TE Connectivity's is 0.27%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Nexans's ROE at 17.55% and TE Connectivity's ROE at 31.28%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $64.00 for Nexans and $153.52 for TE Connectivity. Over the past year, Nexans's prices ranged from $35.20 to $77.55, with a yearly change of 120.31%. TE Connectivity's prices fluctuated between $124.95 and $159.98, with a yearly change of 28.04%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.