TERADYNE INC (TER) Stock Fundamental Analysis
NASDAQ:TER - US8807701029 - Common Stock
122.02 USD
+1.41 (+1.17%)
Taking everything into account, TER scores 6 out of 10 in our fundamental rating. TER was compared to 112 industry peers in the Semiconductors & Semiconductor Equipment industry. TER gets an excellent profitability rating and is at the same time showing great financial health properties. TER has a decent growth rate and is not valued too expensively. With these ratings, TER could be worth investigating further for quality investing!.
1. Profitability
1.1 Basic Checks
TER had positive earnings in the past year.
TER had a positive operating cash flow in the past year.
TER had positive earnings in each of the past 5 years.
TER had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
TER has a better Return On Assets (12.47%) than 84.82% of its industry peers.
TER's Return On Equity of 16.54% is amongst the best of the industry. TER outperforms 83.04% of its industry peers.
Looking at the Return On Invested Capital, with a value of 15.46%, TER belongs to the top of the industry, outperforming 88.39% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for TER is significantly above the industry average of 10.74%.
The 3 year average ROIC (19.67%) for TER is well above the current ROIC(15.46%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.47% | ||
| ROE | 16.54% | ||
| ROIC | 15.46% |
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
Looking at the Profit Margin, with a value of 16.59%, TER is in the better half of the industry, outperforming 76.79% of the companies in the same industry.
In the last couple of years the Profit Margin of TER has remained more or less at the same level.
TER's Operating Margin of 19.22% is fine compared to the rest of the industry. TER outperforms 79.46% of its industry peers.
In the last couple of years the Operating Margin of TER has declined.
With an excellent Gross Margin value of 59.14%, TER belongs to the best of the industry, outperforming 83.93% of the companies in the same industry.
TER's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.22% | ||
| PM (TTM) | 16.59% | ||
| GM | 59.14% |
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), TER is creating some value.
TER has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, TER has less shares outstanding
TER has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
TER has an Altman-Z score of 14.28. This indicates that TER is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 14.28, TER belongs to the top of the industry, outperforming 83.04% of the companies in the same industry.
There is no outstanding debt for TER. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 14.28 |
ROIC/WACC1.36
WACC11.38%
2.3 Liquidity
TER has a Current Ratio of 2.35. This indicates that TER is financially healthy and has no problem in meeting its short term obligations.
TER has a worse Current ratio (2.35) than 65.18% of its industry peers.
TER has a Quick Ratio of 1.83. This is a normal value and indicates that TER is financially healthy and should not expect problems in meeting its short term obligations.
TER has a Quick ratio of 1.83. This is comparable to the rest of the industry: TER outperforms 40.18% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.35 | ||
| Quick Ratio | 1.83 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 7.09% over the past year.
The Earnings Per Share has been growing slightly by 2.47% on average over the past years.
The Revenue has been growing slightly by 4.57% in the past year.
Measured over the past years, TER shows a small growth in Revenue. The Revenue has been growing by 4.21% on average per year.
EPS 1Y (TTM)7.09%
EPS 3Y-18.64%
EPS 5Y2.47%
EPS Q2Q%-33.72%
Revenue 1Y (TTM)4.57%
Revenue growth 3Y-8.68%
Revenue growth 5Y4.21%
Sales Q2Q%-10.7%
3.2 Future
Based on estimates for the next years, TER will show a quite strong growth in Earnings Per Share. The EPS will grow by 19.26% on average per year.
TER is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.48% yearly.
EPS Next Y-2.48%
EPS Next 2Y18.94%
EPS Next 3Y21.08%
EPS Next 5Y19.26%
Revenue Next Year2.86%
Revenue Next 2Y10.75%
Revenue Next 3Y12.17%
Revenue Next 5Y10.48%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 38.49, TER can be considered very expensive at the moment.
TER's Price/Earnings ratio is a bit cheaper when compared to the industry. TER is cheaper than 60.71% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.90. TER is valued slightly more expensive when compared to this.
Based on the Price/Forward Earnings ratio of 26.79, the valuation of TER can be described as expensive.
TER's Price/Forward Earnings is on the same level as the industry average.
TER's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 22.52.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 38.49 | ||
| Fwd PE | 26.79 |
4.2 Price Multiples
TER's Enterprise Value to EBITDA ratio is in line with the industry average.
71.43% of the companies in the same industry are more expensive than TER, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 34.12 | ||
| EV/EBITDA | 28.18 |
4.3 Compensation for Growth
The excellent profitability rating of TER may justify a higher PE ratio.
A more expensive valuation may be justified as TER's earnings are expected to grow with 21.08% in the coming years.
PEG (NY)N/A
PEG (5Y)15.58
EPS Next 2Y18.94%
EPS Next 3Y21.08%
5. Dividend
5.1 Amount
With a yearly dividend of 0.41%, TER is not a good candidate for dividend investing.
TER's Dividend Yield is a higher than the industry average which is at 2.35.
Compared to an average S&P500 Dividend Yield of 2.32, TER's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.41% |
5.2 History
On average, the dividend of TER grows each year by 6.27%, which is quite nice.
TER has paid a dividend for at least 10 years, which is a reliable track record.
TER has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)6.27%
Div Incr Years1
Div Non Decr Years10
5.3 Sustainability
16.55% of the earnings are spent on dividend by TER. This is a low number and sustainable payout ratio.
TER's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP16.55%
EPS Next 2Y18.94%
EPS Next 3Y21.08%
NASDAQ:TER (9/3/2025, 9:44:01 AM)
122.02
+1.41 (+1.17%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners99.76%
Inst Owner Change3.3%
Ins Owners0.18%
Ins Owner Change2.13%
Market Cap19.41B
Analysts71.82
Price Target117.65 (-3.58%)
Short Float %4.63%
Short Ratio1.77
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.41% |
Yearly Dividend0.49
Dividend Growth(5Y)6.27%
DP16.55%
Div Incr Years1
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)12.49%
Min EPS beat(2)4.95%
Max EPS beat(2)20.03%
EPS beat(4)4
Avg EPS beat(4)10.49%
Min EPS beat(4)3.4%
Max EPS beat(4)20.03%
EPS beat(8)8
Avg EPS beat(8)15.7%
EPS beat(12)12
Avg EPS beat(12)16.78%
EPS beat(16)16
Avg EPS beat(16)14.46%
Revenue beat(2)0
Avg Revenue beat(2)-0.47%
Min Revenue beat(2)-0.7%
Max Revenue beat(2)-0.24%
Revenue beat(4)2
Avg Revenue beat(4)0.4%
Min Revenue beat(4)-0.7%
Max Revenue beat(4)1.9%
Revenue beat(8)5
Avg Revenue beat(8)1.21%
Revenue beat(12)9
Avg Revenue beat(12)1.59%
Revenue beat(16)13
Avg Revenue beat(16)1.39%
PT rev (1m)19.47%
PT rev (3m)12.76%
EPS NQ rev (1m)-8.32%
EPS NQ rev (3m)-35.8%
EPS NY rev (1m)-2.92%
EPS NY rev (3m)-2.87%
Revenue NQ rev (1m)-1.8%
Revenue NQ rev (3m)-16.5%
Revenue NY rev (1m)-0.41%
Revenue NY rev (3m)-0.31%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 38.49 | ||
| Fwd PE | 26.79 | ||
| P/S | 6.86 | ||
| P/FCF | 34.12 | ||
| P/OCF | 24.49 | ||
| P/B | 6.84 | ||
| P/tB | 8.59 | ||
| EV/EBITDA | 28.18 |
EPS(TTM)3.17
EY2.6%
EPS(NY)4.56
Fwd EY3.73%
FCF(TTM)3.58
FCFY2.93%
OCF(TTM)4.98
OCFY4.08%
SpS17.78
BVpS17.84
TBVpS14.2
PEG (NY)N/A
PEG (5Y)15.58
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.47% | ||
| ROE | 16.54% | ||
| ROCE | 17.61% | ||
| ROIC | 15.46% | ||
| ROICexc | 17.56% | ||
| ROICexgc | 22.3% | ||
| OM | 19.22% | ||
| PM (TTM) | 16.59% | ||
| GM | 59.14% | ||
| FCFM | 20.12% |
ROA(3y)15.98%
ROA(5y)19.21%
ROE(3y)22.06%
ROE(5y)28.25%
ROIC(3y)19.67%
ROIC(5y)24.33%
ROICexc(3y)27.48%
ROICexc(5y)40.08%
ROICexgc(3y)35.32%
ROICexgc(5y)56.65%
ROCE(3y)22.4%
ROCE(5y)27.7%
ROICexcg growth 3Y-36.99%
ROICexcg growth 5Y-17.13%
ROICexc growth 3Y-32.99%
ROICexc growth 5Y-11.32%
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%
F-Score7
Asset Turnover0.75
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 181.67% | ||
| Cap/Sales | 7.91% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 118.88% | ||
| Profit Quality | 121.26% | ||
| Current Ratio | 2.35 | ||
| Quick Ratio | 1.83 | ||
| Altman-Z | 14.28 |
F-Score7
WACC11.38%
ROIC/WACC1.36
Cap/Depr(3y)152.3%
Cap/Depr(5y)141.7%
Cap/Sales(3y)6.05%
Cap/Sales(5y)5.53%
Profit Quality(3y)80.07%
Profit Quality(5y)84.52%
High Growth Momentum
Growth
EPS 1Y (TTM)7.09%
EPS 3Y-18.64%
EPS 5Y2.47%
EPS Q2Q%-33.72%
EPS Next Y-2.48%
EPS Next 2Y18.94%
EPS Next 3Y21.08%
EPS Next 5Y19.26%
Revenue 1Y (TTM)4.57%
Revenue growth 3Y-8.68%
Revenue growth 5Y4.21%
Sales Q2Q%-10.7%
Revenue Next Year2.86%
Revenue Next 2Y10.75%
Revenue Next 3Y12.17%
Revenue Next 5Y10.48%
EBIT growth 1Y4.88%
EBIT growth 3Y-23.01%
EBIT growth 5Y0.38%
EBIT Next Year21.07%
EBIT Next 3Y25.03%
EBIT Next 5Y23.17%
FCF growth 1Y22.9%
FCF growth 3Y-21.12%
FCF growth 5Y1.31%
OCF growth 1Y28.43%
OCF growth 3Y-15.1%
OCF growth 5Y3.04%