Amphenol Raises Dividend 20% and Approves $4 Billion Share Buyback Plan
Key Facts
Amphenol approved a 20% increase in its quarterly cash dividend to $0.15 per share from $0.125, and its board approved a new $4 billion share repurchase plan lasting three years on October 27. The company said the plan takes effect on January 1, 2027, while it expects to complete the remaining $2 billion under its previous plan by December 31, 2026. The decision combines a dividend increase with a new buyback program as the company recorded quarterly sales and orders at record levels. The new dividend will be paid on January 13, 2027, to shareholders of record on December 22, 2026. The company's shares closed at $79.3 on October 30, according to EL7 data.
Sales reached $10.2 billion in the third quarter of 2026, up 65% in dollars and 37% organically from the same period a year earlier. Orders reached $12.2 billion, putting the book-to-bill ratio at 1.19 to 1. The ratio shows that the value of orders during the quarter exceeded recorded sales, alongside the company's record revenue. Chief Executive Adam Norwitt said record sales and adjusted earnings per share exceeded the high end of the company's previous guidance. He added that sales grew 65% year over year, driven by strong organic growth in most markets, including continued exceptional growth in the information technology and data communications market.
Diluted earnings per share under generally accepted accounting principles were $0.79, up 61% from a year earlier, while adjusted earnings per share were $0.80, up 74%. Adjusted operating margin was 29.7%, and free cash flow reached $1.6 billion in the quarter. The company attributed its growth to strong organic expansion across its three operating segments, with exceptional growth in the information technology and data communications market. It also cited strong growth in industrial, defense, commercial aerospace and mobile device markets, as well as a contribution from its acquisition program. Those factors were offset by an organic decline in the communications networks market, according to the company's filing with the U.S. Securities and Exchange Commission.
Amphenol returned $553 million to shareholders in the third quarter, including repurchases of 3 million shares for $245 million and dividend payments of $308 million. The announcement of the new plan follows those quarterly returns, while the company expects to complete the remainder of its previous buyback program before the end of 2026. The company raised its estimates for CommScope's business performance this year, expecting sales of $5.1 billion instead of $4.6 billion and a contribution of $0.18 per share to adjusted earnings per share instead of $0.15. The estimates reflect an upward revision to expected sales and the business's contribution to earnings. These figures remain separate from Amphenol's overall guidance for the year, which excludes three acquisitions that had not yet closed.
Amphenol expects fourth-quarter 2026 sales of between $10.3 billion and $10.5 billion, equivalent to growth of about 60% from the year-earlier quarter, and adjusted earnings per share of between $0.81 and $0.83. For fiscal 2026, it targets sales of between $36.9 billion and $37.1 billion, up about 60% year over year, and adjusted earnings per share of between $2.82 and $2.84, up about 70%. The outlook assumes current market conditions continue and exchange rates remain stable. The annual estimates exclude the acquisitions of Advanced PCB, Daxgreen and Humanetics Sensors, which had not yet closed. The combined value of four deals, including Empire Electronics, is about $1.6 billion, and the company is financing them with a mix of available cash and debt. It expects the Advanced PCB and Humanetics deals to close in the fourth quarter of 2026, and the Daxgreen deal in the first quarter of 2027, subject to regulatory approvals and customary closing conditions.