Sensata Technologies Holding plc (ST) stock analysis

P/E below its 5-year median

Sensata Technologies's P/E of 16.1 is below its own 5-year median of 25.0.

P/E below the industry

Sensata Technologies's P/E of 16.1 is below the Laboratory Apparatus and Analytical, Optical, Measuring, and Controlling Instruments median of 36.5.

EV/EBITDA below its 5-year median

Sensata Technologies's EV/EBITDA of 9.6 is below its 5-year median of 16.0.

P/B below the industry

Sensata Technologies's price-to-book of 1.91 is below the Laboratory Apparatus and Analytical, Optical, Measuring, and Controlling Instruments median of 3.17.

Trading below fair value

The share price of $40.31 is below our fair value estimate of $73.46.

Margin of safety over 20%

The price is 45.1% below fair value, more than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew -2.8% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -52.7% a year over the last three fiscal years.

Earnings acceleration

Needs positive net income now, a year ago and five years ago.

Growing slower than the industry

Revenue grew 4.1% over the last twelve months; the Laboratory Apparatus and Analytical, Optical, Measuring, and Controlling Instruments median is 8.4%.

Guidance issued

The latest outlook (fourth quarter of 2026 revenue, Oct 27, 2026) was issued for the first time, so it neither adds nor takes away points.

Gross margin improving

Gross margin was 30.8% over the last twelve months, against 28.8% a year earlier.

Return on equity under 15%

Return on equity was 12.7% over the last twelve months and averaged 5.6% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 8.9%, below the 10% that usually covers the cost of capital.

Return on equity above the industry

Sensata Technologies's return on equity of 12.7% is above the Laboratory Apparatus and Analytical, Optical, Measuring, and Controlling Instruments median of 1.1%.

Earnings shrank over 5 years

Net income shrank 28.2% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 9.5% over the last twelve months, against a 5-year average of 4.2%.

Net margin above the industry

Sensata Technologies's net margin of 9.5% is above the Laboratory Apparatus and Analytical, Optical, Measuring, and Controlling Instruments median of -1.3%.

High debt

Debt is 78.0% of shareholders' equity, above the 40% we consider low.

Debt falling against equity

Debt to equity fell from 147% five years ago to 78.0%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 31.7% of total debt.

Interest not well covered

Operating income covers interest expense 4.4 times; we look for at least 5.

Short-term assets cover short-term debts

Current assets are 2.39 times current liabilities.

Bankruptcy risk in the grey zone

The Altman Z-score is 2.58; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Sensata Technologies paid dividends worth 1.2% of the share price over the last twelve months.

Yield below Treasuries

The 1.2% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Sensata Technologies yields 1.2%.

Dividend stability

Fewer than five years of dividend history.

Covered by earnings

Dividends take 19.1% of net income.

Covered by free cash flow

Dividends take 10.9% of free cash flow.