TERADYNE INC (1TER.MI) Stock Fundamental Analysis
Europe - Euronext Milan - BIT:1TER - US8807701029 - Common Stock
194.54 EUR
-2.06 (-1.05%)
Taking everything into account, 1TER scores 5 out of 10 in our fundamental rating. 1TER was compared to 69 industry peers in the Semiconductors & Semiconductor Equipment industry. 1TER has an excellent financial health rating, but there are some minor concerns on its profitability. 1TER is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year 1TER was profitable.
- In the past year 1TER had a positive cash flow from operations.
- 1TER had positive earnings in each of the past 5 years.
- 1TER had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- 1TER has a better Return On Assets (11.18%) than 60.87% of its industry peers.
- 1TER has a Return On Equity of 16.31%. This is comparable to the rest of the industry: 1TER outperforms 53.62% of its industry peers.
- 1TER has a better Return On Invested Capital (14.93%) than 71.01% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for 1TER is significantly above the industry average of 14.31%.
- The 3 year average ROIC (19.67%) for 1TER is well above the current ROIC(14.93%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.18% | ||
| ROE | 16.31% | ||
| ROIC | 14.93% |
ROA(3y)15.98%
ROA(5y)19.21%
ROE(3y)22.06%
ROE(5y)28.25%
ROIC(3y)19.67%
ROIC(5y)24.33%
1.3 Margins
- 1TER has a Profit Margin (15.49%) which is comparable to the rest of the industry.
- 1TER's Profit Margin has been stable in the last couple of years.
- 1TER's Operating Margin of 18.84% is in line compared to the rest of the industry. 1TER outperforms 53.62% of its industry peers.
- 1TER's Operating Margin has declined in the last couple of years.
- With a decent Gross Margin value of 58.92%, 1TER is doing good in the industry, outperforming 79.71% of the companies in the same industry.
- In the last couple of years the Gross Margin of 1TER has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.84% | ||
| PM (TTM) | 15.49% | ||
| GM | 58.92% |
OM growth 3Y-15.69%
OM growth 5Y-3.67%
PM growth 3Y-11.13%
PM growth 5Y-1.14%
GM growth 3Y-0.63%
GM growth 5Y0.03%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), 1TER is creating some value.
- Compared to 1 year ago, 1TER has more shares outstanding
- Compared to 5 years ago, 1TER has less shares outstanding
- There is no outstanding debt for 1TER. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
- An Altman-Z score of 19.20 indicates that 1TER is not in any danger for bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 19.20, 1TER belongs to the top of the industry, outperforming 89.86% of the companies in the same industry.
- The Debt to FCF ratio of 1TER is 0.44, which is an excellent value as it means it would take 1TER, only 0.44 years of fcf income to pay off all of its debts.
- 1TER's Debt to FCF ratio of 0.44 is amongst the best of the industry. 1TER outperforms 86.96% of its industry peers.
- A Debt/Equity ratio of 0.07 indicates that 1TER is not too dependend on debt financing.
- The Debt to Equity ratio of 1TER (0.07) is better than 73.91% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.07 | ||
| Debt/FCF | 0.44 | ||
| Altman-Z | 19.2 |
ROIC/WACC1.37
WACC10.93%
2.3 Liquidity
- A Current Ratio of 1.76 indicates that 1TER should not have too much problems paying its short term obligations.
- 1TER has a Current ratio of 1.76. This is in the lower half of the industry: 1TER underperforms 73.91% of its industry peers.
- A Quick Ratio of 1.39 indicates that 1TER should not have too much problems paying its short term obligations.
- 1TER has a worse Quick ratio (1.39) than 73.91% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.76 | ||
| Quick Ratio | 1.39 |
3. Growth
3.1 Past
- 1TER shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 1.96%.
- Measured over the past 5 years, 1TER shows a small growth in Earnings Per Share. The EPS has been growing by 2.47% on average per year.
- 1TER shows a small growth in Revenue. In the last year, the Revenue has grown by 4.46%.
- 1TER shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.21% yearly.
EPS 1Y (TTM)1.96%
EPS 3Y-18.64%
EPS 5Y2.47%
EPS Q2Q%-5.56%
Revenue 1Y (TTM)4.46%
Revenue growth 3Y-8.68%
Revenue growth 5Y4.21%
Sales Q2Q%4.33%
3.2 Future
- The Earnings Per Share is expected to grow by 22.65% on average over the next years. This is a very strong growth
- 1TER is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 12.60% yearly.
EPS Next Y10.61%
EPS Next 2Y27.87%
EPS Next 3Y28.37%
EPS Next 5Y22.65%
Revenue Next Year9.52%
Revenue Next 2Y16.25%
Revenue Next 3Y15.93%
Revenue Next 5Y12.6%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 74.54 indicates a quite expensive valuation of 1TER.
- Based on the Price/Earnings ratio, 1TER is valued a bit more expensive than 76.81% of the companies in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 28.60, 1TER is valued quite expensively.
- 1TER is valuated quite expensively with a Price/Forward Earnings ratio of 44.24.
- Based on the Price/Forward Earnings ratio, 1TER is valued a bit more expensive than 76.81% of the companies in the same industry.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.83, 1TER is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 74.54 | ||
| Fwd PE | 44.24 |
4.2 Price Multiples
- 82.61% of the companies in the same industry are cheaper than 1TER, based on the Enterprise Value to EBITDA ratio.
- Based on the Price/Free Cash Flow ratio, 1TER is valued a bit more expensive than 62.32% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 79.86 | ||
| EV/EBITDA | 54.61 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- 1TER has a very decent profitability rating, which may justify a higher PE ratio.
- A more expensive valuation may be justified as 1TER's earnings are expected to grow with 28.37% in the coming years.
PEG (NY)7.03
PEG (5Y)30.16
EPS Next 2Y27.87%
EPS Next 3Y28.37%
5. Dividend
5.1 Amount
- 1TER has a yearly dividend return of 0.21%, which is pretty low.
- Compared to an average industry Dividend Yield of 0.74, 1TER has a dividend in line with its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.82, 1TER's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.21% |
5.2 History
- The dividend of 1TER is nicely growing with an annual growth rate of 6.27%!
Dividend Growth(5Y)6.27%
Div Incr YearsN/A
Div Non Decr YearsN/A
5.3 Sustainability
- 1TER pays out 17.39% of its income as dividend. This is a sustainable payout ratio.
- 1TER's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP17.39%
EPS Next 2Y27.87%
EPS Next 3Y28.37%
TERADYNE INC / 1TER.MI FAQ
What is the ChartMill fundamental rating of TERADYNE INC (1TER.MI) stock?
ChartMill assigns a fundamental rating of 6 / 10 to 1TER.MI.
What is the valuation status for 1TER stock?
ChartMill assigns a valuation rating of 2 / 10 to TERADYNE INC (1TER.MI). This can be considered as Overvalued.
Can you provide the profitability details for TERADYNE INC?
TERADYNE INC (1TER.MI) has a profitability rating of 6 / 10.
What is the valuation of TERADYNE INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for TERADYNE INC (1TER.MI) is 74.54 and the Price/Book (PB) ratio is 13.43.
Can you provide the dividend sustainability for 1TER stock?
The dividend rating of TERADYNE INC (1TER.MI) is 4 / 10 and the dividend payout ratio is 17.39%.