CTS (NYSE:CTS) Announces Quarterly Earnings Results, Beats Expectations By $0.13 EPS

CTS (NYSE:CTS) announced its quarterly earnings data on Tuesday. The electronics maker reported $0.74 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.61 by $0.13, FiscalAI reports. The company had revenue of $144.78 million during the quarter, compared to analysts’ expectations of $143.43 million. CTS had a net margin of 12.37% and a return on equity of 13.48%. During the same quarter in the prior year, the company earned $0.62 EPS. CTS updated its FY 2026 guidance to 2.550-2.700 EPS.

Here are the key takeaways from CTS’s conference call:

• Strong second-quarter performance: Revenue rose 7% year over year to $144.8 million, while adjusted gross margin expanded to a record 41.5%, adjusted EBITDA margin reached 25.4%, and adjusted EPS increased 30% to a record $0.74. Results included approximately $0.07 per share of favorable impact from foreign exchange and a customer reimbursement.
• Diversified markets continued to drive growth. Sales increased 15% year over year, led by Medical revenue growth of 45% and Industrial growth of 16%; Aerospace and Defense bookings and backlog also point to a stronger second half as government funding improves.
• Transportation secured significant new awards totaling approximately $163 million, including a record $100 million sensor award with a North American OEM and a new North American EV customer. Total booked business rose to approximately $1.2 billion.
• Full-year 2026 guidance was raised to revenue of $565 million-$585 million and adjusted diluted EPS of $2.55-$2.70, reflecting continued momentum in diversified markets and anticipated modest commercial-vehicle growth.
• Transportation and cost risks remain. Transportation sales declined 2% year over year, global light-vehicle production is expected to be flat to modestly down, and the company is still negotiating the impact of tariffs, precious-metal inflation, and other input costs; the second-half EPS outlook includes a wide range of possible outcomes.

CTS Stock Performance

CTS stock opened at $61.46 on Thursday. The firm has a 50 day simple moving average of $63.28 and a 200-day simple moving average of $56.31. CTS has a 1-year low of $36.03 and a 1-year high of $69.55. The company has a debt-to-equity ratio of 0.10, a current ratio of 2.61 and a quick ratio of 1.98. The stock has a market cap of $1.76 billion, a price-to-earnings ratio of 25.82, a price-to-earnings-growth ratio of 1.54 and a beta of 1.04.

CTS Announces Dividend

The company also recently announced a quarterly dividend, which was paid on Friday, July 24th. Shareholders of record on Friday, June 26th were issued a $0.04 dividend. This represents a $0.16 annualized dividend and a yield of 0.3%. The ex-dividend date was Friday, June 26th. CTS’s payout ratio is presently 6.72%.

Key Headlines Impacting CTS

Here are the key news stories impacting CTS this week:

• Positive Sentiment: CTS reported second-quarter adjusted EPS of $0.74, well above the $0.61 analyst consensus, while revenue of $144.8 million also exceeded expectations. Adjusted EPS increased from $0.57 a year earlier. CTS Q2 Earnings and Revenues Beat Estimates
• Positive Sentiment: The company raised its full-year 2026 outlook to sales of $565 million-$585 million and adjusted EPS of $2.55-$2.70, above its prior guidance of $560 million-$580 million and $2.35-$2.45. The EPS range is also above the roughly $2.43 consensus estimate. CTS Raises 2026 Outlook
• Positive Sentiment: CTS’s diversification strategy continued to gain traction: sales in industrial, aerospace and defense, and medical markets rose 15% year over year and reached 59% of revenue. Adjusted gross margin expanded to 41.5% from 38.7%, adjusted EBITDA margin rose to 25.4%, and operating cash flow improved to $33.4 million. CTS Reports Q2 Results and Raises Guidance
• Neutral Sentiment: Transportation sales declined 2%, although management cited strong growth in new product wins. Net income increased to $19.2 million, but net margin narrowed to 13.2% from 13.7% a year earlier.
• Negative Sentiment: Forward guidance is based on current market conditions and uses non-GAAP adjusted EPS that CTS cannot reconcile prospectively to GAAP results. With the stock trading near its annual high and at a P/E above 26, investors may have viewed the strong results as already reflected in the share price.

Institutional Trading of CTS

Several institutional investors have recently made changes to their positions in the company. Royal Bank of Canada increased its stake in CTS by 11.2% during the first quarter. Royal Bank of Canada now owns 7,036 shares of the electronics maker’s stock worth $292,000 after acquiring an additional 710 shares during the last quarter. Entropy Technologies LP purchased a new stake in CTS in the third quarter valued at $341,000. Captrust Financial Advisors lifted its stake in shares of CTS by 12.1% in the 2nd quarter. Captrust Financial Advisors now owns 8,113 shares of the electronics maker’s stock valued at $346,000 after purchasing an additional 876 shares during the last quarter. AQR Capital Management LLC lifted its stake in shares of CTS by 19.4% in the 1st quarter. AQR Capital Management LLC now owns 9,576 shares of the electronics maker’s stock valued at $398,000 after purchasing an additional 1,558 shares during the last quarter. Finally, Amundi grew its holdings in shares of CTS by 9.7% during the 1st quarter. Amundi now owns 11,542 shares of the electronics maker’s stock worth $480,000 after purchasing an additional 1,019 shares during the period. Hedge funds and other institutional investors own 96.87% of the company’s stock.

Analyst Ratings Changes

A number of equities research analysts have recently issued reports on CTS shares. Weiss Ratings restated a “hold (c+)” rating on shares of CTS in a research report on Tuesday, May 26th. Zacks Research downgraded CTS from a “strong-buy” rating to a “hold” rating in a research report on Monday, June 29th. Two research analysts have rated the stock with a Hold rating, According to MarketBeat, the company currently has an average rating of “Hold”.

CTS Company Profile

CTS Corporation (NYSE:CTS) is a global manufacturer and supplier of electronic components and sensors, headquartered in Lisle, Illinois. Established in 1896 as the Chicago Telephone Supply Company, the firm has evolved over more than a century to become a diversified provider of high-precision products for a wide range of end markets.

The company’s core business encompasses the design, development and production of sensors and actuators, frequency control devices such as quartz crystals and filters, multilayer ceramic capacitors, and inductive components.