First Horizon is a financial services company offering regional banking, mortgage lending, and wealth management among others. The Zacks Consensus Estimate for its current year earnings has risen 6.7% over the last 60 days, and its dividend yield stands at 2.5%, exceeding the industry average of 1.6%.
Morgan Stanley provides financial services to a diversified clientele, including corporations and governments. The Zacks Consensus Estimate for its earnings this year has grown by 4.4% in the past 60 days, and it offers a dividend yield of 2.1%, compared to an industry average of 0.9%.
TE Connectivity’s Earnings Growth
TE Connectivity designs and manufactures connectivity and sensor solutions across various industries such as automotive and aerospace. Its earnings estimate for the current year has seen a 4.3% increase in 60 days, with a dividend yield of 1.2%, while the industry average stands at 0.0%.
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We are seeing positive signals in the financial sector, particularly with companies like First Horizon (FHN) and Morgan Stanley (MS). Their current year earnings estimates have been revised upwards, suggesting underlying strength that the market may not have fully priced in yet. This follows the Federal Reserve’s statement last week on January 14, 2026, which signaled a continued pause on interest rate hikes, bringing a degree of predictability to the sector.
Given this stable rate environment, implied volatility in banking stocks has receded from the highs we saw during the uncertainty of 2025. Fourth-quarter 2025 data showed net interest margins for many regional banks finally stabilizing, which supports the positive outlook on FHN. Therefore, selling cash-secured puts on these names for February expirations could be a prudent way to collect premium while defining a potential entry point below the current market price.
Positive Trends in Technology Manufacturing
A similar pattern of positive earnings revisions is emerging in the technology manufacturing space, highlighted by TE Connectivity (TEL). The company is well-positioned to benefit from the rebound in global auto sales, which grew 3.1% in the final quarter of 2025, according to the latest Global Automotive Alliance report. This suggests that demand for its sensor and connectivity solutions is solidifying.
The latest manufacturing PMI data released on January 5, 2026, registered a 51.8, indicating continued sector expansion and creating a tailwind for industrial suppliers like TEL. Considering this momentum, we could look at bull call spreads to capture potential upside ahead of their earnings announcement next month. This strategy would limit our initial capital outlay while providing exposure to the positive sentiment.
