Teradyne, Inc. (NASDAQ:TER) Just Released Its Yearly Results And Analysts Are Updating Their Estimates

It's been a mediocre week for Teradyne, Inc. (NASDAQ:TER) shareholders, with the stock dropping 11% to US$115 in the week since its latest annual results. Teradyne reported in line with analyst predictions, delivering revenues of US$2.8b and statutory earnings per share of US$3.32, suggesting the business is executing well and in line with its plan. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for Teradyne

Following the latest results, Teradyne's 16 analysts are now forecasting revenues of US$3.28b in 2025. This would be a notable 16% improvement in revenue compared to the last 12 months. Per-share earnings are expected to ascend 18% to US$3.92. In the lead-up to this report, the analysts had been modelling revenues of US$3.36b and earnings per share (EPS) of US$4.10 in 2025. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.

Despite the cuts to forecast earnings, there was no real change to the US$138 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Teradyne, with the most bullish analyst valuing it at US$180 and the most bearish at US$100.00 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Teradyne shareholders.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. For example, we noticed that Teradyne's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 16% growth to the end of 2025 on an annualised basis. That is well above its historical decline of 1.1% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 19% per year. So while Teradyne's revenues are expected to improve, it seems that it is expected to grow at about the same rate as the overall industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. They also downgraded their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Teradyne. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Teradyne going out to 2027, and you can see them free on our platform here..

We also provide an overview of the Teradyne Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.