QS Research · Michael Burry's Scion Capital analyst template · 2006
AMPHENOL CORP /DE/ (APH)
As of 2026-11-08 · 13/15 boxes filled from SEC filings and market data
Conclusion: PASS
Conviction low · base case none · downside -21% · upside +13%
Amphenol is executing exceptionally: Q3 2026 sales rose 65% with record orders of $12.2B and a 1.19:1 book-to-bill, and FY2026 guidance was raised to $36.9-$37.1B sales and $2.82-$2.84 adjusted EPS. But at today's 18.6x EV/EBITDA and 31.0x P/E, the base case is essentially today's price; even a 20% EBITDA pullback at the same multiple gives about -21%, while FY2026 guidance at the same multiple gives only about +13%. I am not using section 13's 15x-22x range as a rerating because the cited catalysts support earnings, not a different multiple. The business is high quality, but the price leaves no deep-value margin of safety, so I pass.
Key numbers
- Share price: $74.59
- Market cap: $184.18B
- Latest financial period: TTM to Sep 30, 2026
- Revenue (TTM): $33.05B
- EV / EBITDA (TTM): 18.6x
- P/E (TTM): 31.0x
- Price / book: 10.76x
The 15 boxes
- ✓ 1. Long-form business notes
Amphenol makes connectors, interconnect systems, antennas, cable and sensors and sells them into a diversified set of end markets; the FY2025 10-K reports three reportable segments — Communications Solutions (52% of 2025 net sales), Harsh Environment Solutions (26%) and Interconnect and Sensor Systems (22%) — versus two segments in the FY2020 10-K (Interconnect Products and Assemblies 96%; Cable Products and Solutions 4%). The company scaled revenue from $8.60B (FY2020) to $23.09B (FY2025) with operating income of $1.64B rising to $5.87B, and operating cash flow from $1.59B to $5.37B. Growth is heavily acquisition-assisted: about $3.8B for five deals in 2025, ~$2.2B for two in 2024, and ~$10.5B for CommScope, completed January 9, 2026 and described as the largest acquisition in the company's history.
- ✓ 2. Competitive advantage
Amphenol reads as a scale-and-qualification franchise rather than a single-patent one: FY2025 gross profit was $8.52B on $23.09B revenue and operating income $5.87B (~37%/~25%, my arithmetic on the XBRL), up from ~31%/~19% in FY2020, and every year in the six-year XBRL window was profitable with operating cash flow of $5.37B against $4.27B of net income in FY2025. The advantage it describes is customer design-in (approved vendor status on new programs), a broad qualified-supplier position with customers who are consolidating vendor lists, and a manufacturing footprint in ~40 countries that the company itself calls a competitive advantage. Competition is real and price is named as a criterion; competitors include TE Connectivity, Molex, Luxshare, Foxconn Interconnect, Corning and others, plus many smaller specialists. Booked demand supports the picture ($8.9B backlog at 2025-12-31 vs $6.1B a year earlier, AI-driven) but backlog is cancellable and management says it may not be indicative of future demand.
- ✓ 3. 10-Q takeaways
Q3 2026 was a blowout: net sales of $10,229.7M versus $6,194.4M in Q3 2025 (+65% in dollars and constant currency, +37% organic), with record orders of $12.2 billion and a 1.19:1 book-to-bill, and GAAP operating margin up to 29.5% (adjusted 29.7%) from 27.5%. GAAP diluted EPS was $0.79 versus $0.49, though a $15.0 IEEPA tariff-recovery benefit sat inside operating income and $60.0 of discrete tax accruals hit the quarter. Cash fell to $5,301.4M from $11,434.2M at 12/31/25 as $12,979.2M went out in investing activities (CommScope), while nine-month operating cash flow rose to $4,757.2M; the company bought back 3.0M shares for $245M, raised the dividend 20% and set a new $4B repurchase plan. Guidance for Q4 2026 is $10.3-10.5B sales and $0.81-0.83 adjusted diluted EPS, with FY2026 at $36.9-37.1B and $2.82-2.84.
- ✓ 4. Corporate governance
Filled; members read this box.
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ✓ 9. Insider trading interpretation
Filled; members read this box.
- ○ 10. Earnings-call notes
- ✓ 11. Impression of the shareholder letter
Filled; members read this box.
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
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