CTS Corporation

CTS Corporation raised its full-year 2026 guidance following second-quarter results that included record adjusted gross margin and a 30% jump in adjusted earnings per share. Revenue rose 7% year over year to $144.8 million, driven by a 45% surge in medical sales and a 16% increase in industrial sales, while transportation revenue slipped 2%. Adjusted gross margin reached a record 41.5%, and adjusted diluted EPS climbed to $0.74. The company now expects 2026 sales of $565 million to $585 million and adjusted diluted EPS of $2.55 to $2.70, supported by continued diversified-market growth despite uncertainty in transportation, tariffs, and input costs.

CTS Corporation introduced the TSX Crystal with Integrated Thermistor, its first crystal product to embed a thermistor inside the package, providing real-time temperature feedback near the crystal element to improve frequency compensation and reduce board complexity. The TSX series supports frequencies from 16 MHz to 285 MHz with stability options from ±10 ppm to ±50 ppm over temperature, targeting network synchronization, routers, and switches. CTS also markets temperature sensors for server racks, cooling systems, and airflow-management zones, giving the stock sensor-level exposure to the cooling efficiency challenges driven by AI infrastructure.

A bullish thesis on CTS Corporation highlights the company's transformation away from automotive dependence toward higher-margin sectors including medical technology, aerospace and defense, and industrial automation. The thesis, published on TradersPro's Substack, notes that medical technology demand, rising global defense spending, and factory automation adoption are creating durable growth drivers. CTS shares traded at $66.63 as of June 15th, with trailing and forward P/E ratios of 28.26 and 27.25 respectively. Supporters point to constructive technical indicators and the potential for margin and earnings improvement as the diversification strategy progresses.