Amphenol (NYSE:APH) Performing Below Historical Seasonal Averages

Amphenol (NYSE:APH) appears to be underperforming when measured by historical seasonal averages, says Ticonderoga, who sees sales decling in the fourth quarter of 2010, following after a record September quarter sequential sales increase for the company.

Ticonderoga says, "Our 4Q10 Projections Are Below Historical Seasonality. After the biggest September quarter sequential sales uptick (up 7.2% Q/Q) for Amphenol in over a decade, we are projecting a 1% Q/Q sales decline in 4Q10 and well below the average 4% Q/Q uptick over the past eleven years. We believe Amphenol will at least meet our 4Q10 revenue estimate of $943.1 million and our pro forma EPS projection of $0.73 (Street is at $0.73). Recall, the company's 4Q10 outlook calls for revenues of $933 million to $948 million and pro forma EPS of $0.71 to $0.73. We are projecting a gross margin of 32.7% (flat Q/Q) and an operating margin of 20.0% (vs. 19.9% in 3Q10). As we remain early in the year, we view our 2011 sales growth projection of 9% for Amphenol as conservative and below the five-year average uptick of over 14%. Keep in mind, our 2010 projection calls for sales growth of 26% for Amphenol...We Are Modeling More Muted 4Q Tech Infrastructure Trends for APH.

"Looking into 1Q11, we are modeling sales to fall 3% sequentially and below the seasonal average flat performance over the past eleven years. We believe our revenue projection of $914.6 million and pro forma EPS estimate of $0.69 (Street is at $0.69) should at least fall into the company's outlook range. As always, we expect Amphenol to provide a conservative outlook, and we believe the company's appetite for acquisitions remains as strong as ever."

Ticonderoga reiterates a "Buy" rating on Amphenol (APH), which closed Tuesday at $52.89, up $0.63, or 1.21 percent. Ticonderoga has a price target of $60 on Amphenol.