APH Amphenol

Amphenol designs and manufactures electrical, electronic, and fiber optic connectors and interconnect systems for industrial, telecom, and defense applications. Sector: Technology.

Amphenol (APH) is an individual stock. The analysis below presents key financial metrics for the company, covering profitability, capital efficiency, valuation, margins, and growth.

Assessing the quality of returns on invested capital, ROIC is 26.61%, WACC is 10.63%, and the economic spread is 15.97%. On balance, the company is clearing their capital cost hurdle with room to spare. Supporting metrics show ROE at 36.98% and ROA at 14.56%, a combination that helps frame whether profitability strength is broad enough to hold through different market conditions. Taken together, the return profile suggests a company with credible compounding capacity if current operating execution persists.

The company's current market valuation reflects trailing P/E of 38.32, forward P/E of 29.25, PEG of 1.77. The trailing-to-forward compression is present but not extreme — consistent with a company where earnings are expected to grow at a steady rather than exceptional pace. The PEG reads as moderate — investors are paying a fair but not discounted price for the growth embedded in current estimates. At 2.98, the aggregate current ratio reflects strong balance sheet liquidity across the company. Across multiples and liquidity, the company is priced in a way that reflects current expectations reasonably well — leaving limited room for error, but also limited near-term downside from valuation compression alone.

Looking at margins from gross to free cash flow, gross margin sits at 37.05%, operating margin at 26.02%, and free cash flow margin at 18.96%. The gross margin reading is middling — acceptable, but leaving less room for error at the production level. At this level, operating margins reflect businesses that are scaling with discipline without dramatic cost pressure. The company's cash conversion is solid — a sign that operating profits are translating into real liquidity for the company. Margins indicate a company that is operating effectively in some areas while still showing efficiency gaps in others.

Projected 12-month EPS growth of 31.0% adds a powerful forward signal — analyst consensus expects earnings to accelerate materially, which, if delivered, could make current multiples look increasingly modest. Zooming out from the valuation discussion, TTM revenue growth of 49.13% pointing to sustained and broad-based revenue growth within the company, while the estimated 12-month price change of 26.84%, where target prices point to mid-range appreciation potential from current levels. Anchoring to reported revenues provides discipline; analyst price targets add context about how the market currently values that operating reality. The path to realizing analyst-implied returns runs through revenue execution, margin stability, and a macro environment that doesn't undermine either. The estimated 12-month price change is based on analyst consensus price target estimates, sourced from publicly available data, and should not be interpreted as a reliable prediction of future performance.

The quantitative profile, taken as a whole, is above average on virtually every dimension that matters for long-term return generation.

This assessment is based solely on the quantitative metrics presented above and does not constitute financial advice. Investors should consider their own risk tolerance and conduct independent research before making investment decisions.