TERADYNE INC (TER) Stock Fundamental Analysis
USA - NASDAQ:TER - US8807701029 - Common Stock
182.28 USD
-2.74 (-1.48%)
182.28 USD
0 (0%)
We assign a fundamental rating of 7 out of 10 to TER. TER was compared to 112 industry peers in the Semiconductors & Semiconductor Equipment industry. Both the health and profitability get an excellent rating, making TER a very profitable company, without any liquidiy or solvency issues. TER has a correct valuation and a medium growth rate. This makes TER very considerable for quality investing!
1. Profitability
1.1 Basic Checks
In the past year TER was profitable.
In the past year TER had a positive cash flow from operations.
TER had positive earnings in each of the past 5 years.
Each year in the past 5 years TER had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 11.18%, TER belongs to the top of the industry, outperforming 83.04% of the companies in the same industry.
Looking at the Return On Equity, with a value of 16.31%, TER belongs to the top of the industry, outperforming 83.04% of the companies in the same industry.
TER has a better Return On Invested Capital (14.93%) than 87.50% of its industry peers.
TER had an Average Return On Invested Capital over the past 3 years of 19.67%. This is significantly above the industry average of 11.09%.
The last Return On Invested Capital (14.93%) for TER is well below the 3 year average (19.67%), which needs to be investigated, but indicates that TER had better years and this may not be a problem.
| 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
The Profit Margin of TER (15.49%) is better than 75.89% of its industry peers.
TER's Profit Margin has been stable in the last couple of years.
Looking at the Operating Margin, with a value of 18.84%, TER is in the better half of the industry, outperforming 78.57% of the companies in the same industry.
TER's Operating Margin has declined in the last couple of years.
TER has a Gross Margin of 58.92%. This is amongst the best in the industry. TER outperforms 83.04% of its industry peers.
TER's Gross Margin has been stable in the last couple of years.
| 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
TER has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, TER has more shares outstanding
The number of shares outstanding for TER has been reduced compared to 5 years ago.
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
An Altman-Z score of 15.60 indicates that TER is not in any danger for bankruptcy at the moment.
TER has a better Altman-Z score (15.60) than 84.82% of its industry peers.
The Debt to FCF ratio of TER is 0.44, which is an excellent value as it means it would take TER, only 0.44 years of fcf income to pay off all of its debts.
TER's Debt to FCF ratio of 0.44 is amongst the best of the industry. TER outperforms 82.14% of its industry peers.
TER has a Debt/Equity ratio of 0.07. This is a healthy value indicating a solid balance between debt and equity.
TER's Debt to Equity ratio of 0.07 is in line compared to the rest of the industry. TER outperforms 58.04% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.07 | ||
| Debt/FCF | 0.44 | ||
| Altman-Z | 15.6 |
ROIC/WACC1.27
WACC11.79%
2.3 Liquidity
TER has a Current Ratio of 1.76. This is a normal value and indicates that TER is financially healthy and should not expect problems in meeting its short term obligations.
TER's Current ratio of 1.76 is on the low side compared to the rest of the industry. TER is outperformed by 79.46% of its industry peers.
TER has a Quick Ratio of 1.39. This is a normal value and indicates that TER is financially healthy and should not expect problems in meeting its short term obligations.
With a Quick ratio value of 1.39, TER is not doing good in the industry: 75.89% of the companies in the same industry are doing better.
The current and quick ratio evaluation for TER is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.76 | ||
| Quick Ratio | 1.39 |
3. Growth
3.1 Past
TER shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 1.96%.
TER shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 2.47% yearly.
The Revenue has been growing slightly by 4.46% in the past year.
TER 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
TER is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 22.65% yearly.
TER is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 12.60% yearly.
EPS Next Y7.8%
EPS Next 2Y25.62%
EPS Next 3Y25.41%
EPS Next 5Y22.65%
Revenue Next Year8.04%
Revenue Next 2Y14.91%
Revenue Next 3Y14.38%
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.
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
TER is valuated quite expensively with a Price/Earnings ratio of 58.42.
TER's Price/Earnings ratio is in line with the industry average.
TER's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 26.06.
Based on the Price/Forward Earnings ratio of 35.87, the valuation of TER can be described as expensive.
The rest of the industry has a similar Price/Forward Earnings ratio as TER.
TER's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 32.73.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 58.42 | ||
| Fwd PE | 35.87 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as TER.
Based on the Price/Free Cash Flow ratio, TER is valued a bit cheaper than 63.39% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 63.47 | ||
| EV/EBITDA | 43.3 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates TER does not grow enough to justify the current Price/Earnings ratio.
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 25.41% in the coming years.
PEG (NY)7.49
PEG (5Y)23.64
EPS Next 2Y25.62%
EPS Next 3Y25.41%
5. Dividend
5.1 Amount
TER has a yearly dividend return of 0.26%, which is pretty low.
TER's Dividend Yield is a higher than the industry average which is at 2.14.
Compared to an average S&P500 Dividend Yield of 2.37, TER's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.26% |
5.2 History
The dividend of TER is nicely growing with an annual growth rate of 6.27%!
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
17.39% of the earnings are spent on dividend by TER. This is a low number and sustainable payout ratio.
The dividend of TER is growing, but earnings are growing more, so the dividend growth is sustainable.
DP17.39%
EPS Next 2Y25.62%
EPS Next 3Y25.41%
182.28
-2.74 (-1.48%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners104.22%
Inst Owner Change-1.79%
Ins Owners0.18%
Ins Owner Change1.76%
Market Cap29.00B
Revenue(TTM)2.86B
Net Income(TTM)443.08M
Analysts74.55
Price Target140.7 (-22.81%)
Short Float %5.69%
Short Ratio2.58
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.26% |
Yearly Dividend0.49
Dividend Growth(5Y)6.27%
DP17.39%
Div Incr Years1
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.89%
Min EPS beat(2)4.95%
Max EPS beat(2)6.84%
EPS beat(4)4
Avg EPS beat(4)8.81%
Min EPS beat(4)3.4%
Max EPS beat(4)20.03%
EPS beat(8)8
Avg EPS beat(8)15.49%
EPS beat(12)12
Avg EPS beat(12)16.55%
EPS beat(16)16
Avg EPS beat(16)14.27%
Revenue beat(2)1
Avg Revenue beat(2)0.85%
Min Revenue beat(2)-0.7%
Max Revenue beat(2)2.4%
Revenue beat(4)2
Avg Revenue beat(4)0.52%
Min Revenue beat(4)-0.7%
Max Revenue beat(4)2.4%
Revenue beat(8)5
Avg Revenue beat(8)1.29%
Revenue beat(12)9
Avg Revenue beat(12)1.6%
Revenue beat(16)13
Avg Revenue beat(16)1.48%
PT rev (1m)15.14%
PT rev (3m)21.35%
EPS NQ rev (1m)31.35%
EPS NQ rev (3m)30.71%
EPS NY rev (1m)9.86%
EPS NY rev (3m)7.31%
Revenue NQ rev (1m)17.71%
Revenue NQ rev (3m)17.49%
Revenue NY rev (1m)4.86%
Revenue NY rev (3m)4.61%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 58.42 | ||
| Fwd PE | 35.87 | ||
| P/S | 10.14 | ||
| P/FCF | 63.47 | ||
| P/OCF | 42.93 | ||
| P/B | 10.67 | ||
| P/tB | 13.53 | ||
| EV/EBITDA | 43.3 |
EPS(TTM)3.12
EY1.71%
EPS(NY)5.08
Fwd EY2.79%
FCF(TTM)2.87
FCFY1.58%
OCF(TTM)4.25
OCFY2.33%
SpS17.98
BVpS17.08
TBVpS13.47
PEG (NY)7.49
PEG (5Y)23.64
Graham Number34.63
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.18% | ||
| ROE | 16.31% | ||
| ROCE | 18.15% | ||
| ROIC | 14.93% | ||
| ROICexc | 16.48% | ||
| ROICexgc | 20.6% | ||
| OM | 18.84% | ||
| PM (TTM) | 15.49% | ||
| GM | 58.92% | ||
| FCFM | 15.98% |
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%
ROICexgc growth 3Y-36.99%
ROICexgc 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-Score6
Asset Turnover0.72
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.07 | ||
| Debt/FCF | 0.44 | ||
| Debt/EBITDA | 0.3 | ||
| Cap/Depr | 177.17% | ||
| Cap/Sales | 7.64% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 101.99% | ||
| Profit Quality | 103.1% | ||
| Current Ratio | 1.76 | ||
| Quick Ratio | 1.39 | ||
| Altman-Z | 15.6 |
F-Score6
WACC11.79%
ROIC/WACC1.27
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)1.96%
EPS 3Y-18.64%
EPS 5Y2.47%
EPS Q2Q%-5.56%
EPS Next Y7.8%
EPS Next 2Y25.62%
EPS Next 3Y25.41%
EPS Next 5Y22.65%
Revenue 1Y (TTM)4.46%
Revenue growth 3Y-8.68%
Revenue growth 5Y4.21%
Sales Q2Q%4.33%
Revenue Next Year8.04%
Revenue Next 2Y14.91%
Revenue Next 3Y14.38%
Revenue Next 5Y12.6%
EBIT growth 1Y2.81%
EBIT growth 3Y-23.01%
EBIT growth 5Y0.38%
EBIT Next Year21.62%
EBIT Next 3Y25.87%
EBIT Next 5Y25.95%
FCF growth 1Y23.48%
FCF growth 3Y-21.12%
FCF growth 5Y1.31%
OCF growth 1Y29.91%
OCF growth 3Y-15.1%
OCF growth 5Y3.04%
TERADYNE INC / TER FAQ
What is the fundamental rating for TER stock?
ChartMill assigns a fundamental rating of 7 / 10 to TER.
Can you provide the valuation status for TERADYNE INC?
ChartMill assigns a valuation rating of 4 / 10 to TERADYNE INC (TER). This can be considered as Fairly Valued.
What is the profitability of TER stock?
TERADYNE INC (TER) has a profitability rating of 8 / 10.
Can you provide the PE and PB ratios for TER stock?
The Price/Earnings (PE) ratio for TERADYNE INC (TER) is 58.42 and the Price/Book (PB) ratio is 10.67.
Can you provide the financial health for TER stock?
The financial health rating of TERADYNE INC (TER) is 7 / 10.