Fabrinet (NYSE:FN) and TE Connectivity (NYSE:TEL) Head-To-Head Comparison

Fabrinet (NYSE:FN) and TE Connectivity (NYSE:TEL) are both large-cap technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, earnings, valuation, analyst recommendations, institutional ownership, profitability and dividends.

Institutional & Insider Ownership

97.4% of Fabrinet shares are owned by institutional investors. Comparatively, 91.4% of TE Connectivity shares are owned by institutional investors. 0.2% of Fabrinet shares are owned by insiders. Comparatively, 0.6% of TE Connectivity shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Fabrinet and TE Connectivity”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Fabrinet	$4.64 billion	3.04	$473.03 million	$13.05	30.18
TE Connectivity	$17.26 billion	3.39	$1.84 billion	$10.20	19.81

TE Connectivity has higher revenue and earnings than Fabrinet. TE Connectivity is trading at a lower price-to-earnings ratio than Fabrinet, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Fabrinet has a beta of 1.21, suggesting that its share price is 21% more volatile than the S&P 500. Comparatively, TE Connectivity has a beta of 1.16, suggesting that its share price is 16% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Fabrinet and TE Connectivity, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Fabrinet	0	4	6	0	2.60
TE Connectivity	1	5	8	1	2.60

Fabrinet presently has a consensus target price of $649.50, indicating a potential upside of 64.94%. TE Connectivity has a consensus target price of $252.00, indicating a potential upside of 24.74%. Given Fabrinet’s higher probable upside, equities analysts clearly believe Fabrinet is more favorable than TE Connectivity.

Profitability

This table compares Fabrinet and TE Connectivity’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fabrinet	10.19%	21.23%	13.96%
TE Connectivity	15.61%	24.59%	12.50%

Summary

TE Connectivity beats Fabrinet on 8 of the 14 factors compared between the two stocks.

About Fabrinet

Fabrinet provides optical packaging and precision optical, electro-mechanical, and electronic manufacturing services in North America, the Asia-Pacific, and Europe. The company offers a range of advanced optical and electro-mechanical capabilities in the manufacturing process, including process design and engineering, supply chain management, manufacturing, printed circuit board assembly, advanced packaging, integration, final assembly, and testing. Its products include switching products, including reconfigurable optical add-drop multiplexers, optical amplifiers, modulators, and other optical components and modules that enable network managers to route voice, video, and data communications traffic through fiber optic cables at various wavelengths, speeds, and over various distances. The company's products also comprise tunable lasers, transceivers, and transponders; and active optical cables, which provide high-speed interconnect capabilities for data centers and computing clusters, as well as Infiniband, Ethernet, fiber channel, and optical backplane connectivity. In addition, it provides solid state, diode-pumped, gas, and fiber lasers used in semiconductor processing, biotechnology and medical device, metrology, and material processing industries; and differential pressure, micro-gyro, fuel, and other sensors used in automobiles, as well as non-contact temperature measurement sensors for the medical industry. Further, the company designs and fabricates application-specific crystals, lenses, prisms, mirrors, laser components, and substrates; and other custom and standard borosilicate, clear fused quartz, and synthetic fused silica glass products. It serves original equipment manufacturers of optical communication components, modules and sub-systems, industrial lasers, automotive components, medical devices, and sensors. The company was incorporated in 1999 and is based in Grand Cayman, the Cayman Islands.

About TE Connectivity

TE Connectivity Ltd., together with its subsidiaries, manufactures and sells connectivity and sensor solutions in Europe, the Middle East, Africa, the AsiaPacific, 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, relays, antennas, and application tooling products for use in the automotive, commercial transportation, and sensor markets. The Industrial Solutions segment offers terminals and connector systems and components; and interventional medical components, relays, heat shrink tubing, and wires and cables for industrial equipment, aerospace, defense, marine, medical, 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. The company sells its products to approximately 140 countries primarily through direct sales 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 founded in 1941 and is based in Schaffhausen, Switzerland.