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As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of Teradyne, Inc. (NASDAQ:TER), it is a company with great financial health as well as a an impressive track record of performance. Below is a brief commentary on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the full report on Teradyne here.
Outstanding track record with excellent balance sheet
TER delivered a bottom-line expansion of 75% in the prior year, with its most recent earnings level surpassing its average level over the last five years. This strong performance generated a robust double-digit return on equity of 30%, which paints a buoyant picture for the company. TER is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This indicates that TER has sufficient cash flows and proper cash management in place, which is an important determinant of the company’s health. TER’s has produced operating cash levels of 1.26x total debt over the past year, which implies that TER’s management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
For Teradyne, I’ve compiled three relevant aspects you should look at:
- Future Outlook: What are well-informed industry analysts predicting for TER’s future growth? Take a look at our free research report of analyst consensus for TER’s outlook.
- Valuation: What is TER worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether TER is currently mispriced by the market.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of TER? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. On rare occasion, data errors may occur. Thank you for reading.