NasdaqGS:TER

Stock Analysis Report

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Market Cap

US$21.1b

Last Updated

2021/08/03 23:36 UTC

Data Sources

Company Financials +

Executive Summary

Teradyne, Inc. designs, develops, manufactures, sells, and supports automatic test equipment worldwide. More Details


Snowflake Analysis

Excellent balance sheet with proven track record.


Similar Companies

Share Price & News

How has Teradyne's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: TER is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: TER's weekly volatility (5%) has been stable over the past year.


Market Performance


7 Day Return

2.7%

TER

5.7%

US Semiconductor

0.9%

US Market


1 Year Return

41.6%

TER

51.5%

US Semiconductor

34.7%

US Market

Return vs Industry: TER underperformed the US Semiconductor industry which returned 53.4% over the past year.

Return vs Market: TER exceeded the US Market which returned 34.4% over the past year.


Shareholder returns

TERIndustryMarket
7 Day2.7%5.7%0.9%
30 Day-1.4%1.2%0.2%
90 Day1.8%13.9%4.7%
1 Year42.1%41.6%53.5%51.5%36.8%34.7%
3 Year193.4%188.0%129.4%118.3%62.5%52.4%
5 Year561.1%537.5%302.9%265.6%123.1%98.4%

Long-Term Price Volatility Vs. Market

How volatile is Teradyne's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Teradyne undervalued compared to its fair value and its price relative to the market?

30.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: TER ($126.74) is trading below our estimate of fair value ($182.41)

Significantly Below Fair Value: TER is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: TER is good value based on its PE Ratio (22.1x) compared to the US Semiconductor industry average (34.4x).

PE vs Market: TER is poor value based on its PE Ratio (22.1x) compared to the US market (17.9x).


Price to Earnings Growth Ratio

PEG Ratio: TER is poor value based on its PEG Ratio (7.2x)


Price to Book Ratio

PB vs Industry: TER is overvalued based on its PB Ratio (8.4x) compared to the US Semiconductor industry average (4.8x).


Future Growth

How is Teradyne forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

3.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TER's forecast earnings growth (3.1% per year) is above the savings rate (2%).

Earnings vs Market: TER's earnings (3.1% per year) are forecast to grow slower than the US market (15% per year).

High Growth Earnings: TER's earnings are forecast to grow, but not significantly.

Revenue vs Market: TER's revenue (7.2% per year) is forecast to grow slower than the US market (9.2% per year).

High Growth Revenue: TER's revenue (7.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TER's Return on Equity is forecast to be high in 3 years time (32.9%)


Past Performance

How has Teradyne performed over the past 5 years?

43.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TER has a high level of non-cash earnings.

Growing Profit Margin: TER's current net profit margins (27.7%) are higher than last year (22.6%).


Past Earnings Growth Analysis

Earnings Trend: TER has become profitable over the past 5 years, growing earnings by 43.4% per year.

Accelerating Growth: TER's earnings growth over the past year (50.8%) exceeds its 5-year average (43.4% per year).

Earnings vs Industry: TER earnings growth over the past year (50.8%) underperformed the Semiconductor industry 55.6%.


Return on Equity

High ROE: TER's Return on Equity (38.2%) is considered high.


Financial Health

How is Teradyne's financial position?


Financial Position Analysis

Short Term Liabilities: TER's short term assets ($2.7B) exceed its short term liabilities ($985.4M).

Long Term Liabilities: TER's short term assets ($2.7B) exceed its long term liabilities ($522.3M).


Debt to Equity History and Analysis

Debt Level: TER's debt to equity ratio (14.3%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if TER's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: TER's debt is well covered by operating cash flow (237.1%).

Interest Coverage: TER's interest payments on its debt are well covered by EBIT (59.4x coverage).


Balance Sheet


Dividend

What is Teradyne current dividend yield, its reliability and sustainability?

0.32%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: TER's dividend (0.32%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.32%).

High Dividend: TER's dividend (0.32%) is low compared to the top 25% of dividend payers in the US market (3.57%).


Stability and Growth of Payments

Stable Dividend: TER is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: TER is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: TER is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of TER's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.0yrs

Average management tenure


CEO

Mark Jagiela (60 yo)

7.5yrs

Tenure

US$10,366,962

Compensation

Mr. Mark E. Jagiela has been the Chief Executive Officer of Teradyne Inc. since February 01, 2014, President since January 1, 2013 and served as its President of Semiconductor Test from 2003 to February 8,...


CEO Compensation Analysis

Compensation vs Market: Mark's total compensation ($USD10.37M) is about average for companies of similar size in the US market ($USD11.16M).

Compensation vs Earnings: Mark's compensation has increased by more than 20% in the past year.


Leadership Team

Experienced Management: TER's management team is not considered experienced ( 2 years average tenure), which suggests a new team.


Board Members

Experienced Board: TER's board of directors are considered experienced (7.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Teradyne, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Teradyne, Inc.
  • Ticker: TER
  • Exchange: NasdaqGS
  • Founded: 1960
  • Industry: Semiconductor Equipment
  • Sector: Semiconductors
  • Market Cap: US$21.073b
  • Shares outstanding: 166.27m
  • Website: https://www.teradyne.com

Number of Employees


Location

  • Teradyne, Inc.
  • 600 Riverpark Drive
  • North Reading
  • Massachusetts
  • 1864
  • United States

Listings


Biography

Teradyne, Inc. designs, develops, manufactures, sells, and supports automatic test equipment worldwide. The company operates through Semiconductor Test, System Test, Industrial Automation, and Wireless Tes...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/08/03 23:36
End of Day Share Price2021/08/03 00:00
Earnings2021/07/04
Annual Earnings2020/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.