TERADYNE INC (TER)
US8807701029 - Common Stock
TER gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 108 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. These ratings could make TER a good candidate for quality investing.
1. Profitability
1.1 Basic Checks
In the past year TER was profitable.
TER had a positive operating cash flow in the past year.
In the past 5 years TER has always been profitable.
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 13.61%, TER belongs to the top of the industry, outperforming 82.41% of the companies in the same industry.
TER has a Return On Equity of 17.68%. This is amongst the best in the industry. TER outperforms 80.56% of its industry peers.
TER has a better Return On Invested Capital (14.07%) than 85.19% of its industry peers.
The Average Return On Invested Capital over the past 3 years for TER is significantly above the industry average of 11.24%.
The last Return On Invested Capital (14.07%) for TER is well below the 3 year average (25.46%), which needs to be investigated, but indicates that TER had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.61% | ||
| ROE | 17.68% | ||
| ROIC | 14.07% |
ROA(3y)19.98%
ROA(5y)19.64%
ROE(3y)28.84%
ROE(5y)30.72%
ROIC(3y)25.46%
ROIC(5y)24.68%
1.3 Margins
With a decent Profit Margin value of 18.75%, TER is doing good in the industry, outperforming 77.78% of the companies in the same industry.
In the last couple of years the Profit Margin of TER has declined.
Looking at the Operating Margin, with a value of 19.14%, TER is in the better half of the industry, outperforming 76.85% of the companies in the same industry.
In the last couple of years the Operating Margin of TER has declined.
TER has a Gross Margin of 57.76%. This is amongst the best in the industry. TER outperforms 81.48% of its industry peers.
TER's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.14% | ||
| PM (TTM) | 18.75% | ||
| GM | 57.76% |
OM growth 3Y-12.71%
OM growth 5Y-3.46%
PM growth 3Y-12.6%
PM growth 5Y-4.86%
GM growth 3Y0.12%
GM growth 5Y-0.23%
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.
The number of shares outstanding for TER has been reduced compared to 1 year ago.
The number of shares outstanding for TER has been reduced compared to 5 years ago.
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.
2.2 Solvency
An Altman-Z score of 16.14 indicates that TER is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 16.14, TER belongs to the best of the industry, outperforming 86.11% 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 | 16.14 |
ROIC/WACC0.91
WACC15.53%
2.3 Liquidity
TER has a Current Ratio of 3.09. This indicates that TER is financially healthy and has no problem in meeting its short term obligations.
TER has a Current ratio (3.09) which is comparable to the rest of the industry.
A Quick Ratio of 2.59 indicates that TER has no problem at all paying its short term obligations.
The Quick ratio of TER (2.59) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.09 | ||
| Quick Ratio | 2.59 |
3. Growth
3.1 Past
TER shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by 0.00%.
TER shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 4.25% yearly.
Looking at the last year, TER shows a small growth in Revenue. The Revenue has grown by 0.00% in the last year.
Measured over the past years, TER shows a small growth in Revenue. The Revenue has been growing by 4.96% on average per year.
EPS 1Y (TTM)0%
EPS 3Y-14.02%
EPS 5Y4.25%
EPS Q2Q%12.5%
Revenue 1Y (TTM)0%
Revenue growth 3Y-5%
Revenue growth 5Y4.96%
Sales Q2Q%4.77%
3.2 Future
TER is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 22.18% yearly.
TER is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 11.63% yearly.
EPS Next Y9.44%
EPS Next 2Y21.37%
EPS Next 3Y28.28%
EPS Next 5Y22.18%
Revenue Next Year4.69%
Revenue Next 2Y11.87%
Revenue Next 3Y14.91%
Revenue Next 5Y11.63%
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
With a Price/Earnings ratio of 41.16, TER can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of TER is on the same level as its industry peers.
TER's Price/Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 27.73.
With a Price/Forward Earnings ratio of 29.18, TER can be considered very expensive at the moment.
60.19% of the companies in the same industry are more expensive than TER, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of TER to the average of the S&P500 Index (22.83), we can say TER is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 41.16 | ||
| Fwd PE | 29.18 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TER is valued a bit cheaper than 62.04% of the companies in the same industry.
70.37% 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 | 45.25 | ||
| EV/EBITDA | 31.09 |
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 28.28% in the coming years.
PEG (NY)4.36
PEG (5Y)9.69
EPS Next 2Y21.37%
EPS Next 3Y28.28%
5. Dividend
5.1 Amount
TER has a yearly dividend return of 0.38%, which is pretty low.
Compared to an average industry Dividend Yield of 2.31, TER pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.38, TER pays less dividend than the S&P500 average, which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.38% |
5.2 History
The dividend of TER has a limited annual growth rate of 3.94%.
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)3.94%
Div Incr Years1
Div Non Decr Years10
5.3 Sustainability
TER pays out 14.37% of its income as dividend. This is a sustainable payout ratio.
The dividend of TER is growing, but earnings are growing more, so the dividend growth is sustainable.
DP14.37%
EPS Next 2Y21.37%
EPS Next 3Y28.28%
TERADYNE INC
NASDAQ:TER (12/20/2024, 8:00:01 PM)
After market: 126.86 +0.91 (+0.72%)125.95
+0.76 (+0.61%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners102.32%
Inst Owner Change-0.46%
Ins Owners0.14%
Ins Owner Change-1.81%
Market Cap20.51B
Analysts73.04
Price Target135.19 (7.34%)
Short Float %2.78%
Short Ratio1.91
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.38% |
Dividend Growth(5Y)3.94%
DP14.37%
Div Incr Years1
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)12.19%
Min EPS beat(2)10.81%
Max EPS beat(2)13.57%
EPS beat(4)4
Avg EPS beat(4)22.17%
Min EPS beat(4)9.94%
Max EPS beat(4)54.36%
EPS beat(8)8
Avg EPS beat(8)20.42%
EPS beat(12)12
Avg EPS beat(12)16.09%
EPS beat(16)16
Avg EPS beat(16)13.98%
Revenue beat(2)2
Avg Revenue beat(2)2.48%
Min Revenue beat(2)1.9%
Max Revenue beat(2)3.06%
Revenue beat(4)3
Avg Revenue beat(4)2.06%
Min Revenue beat(4)-1.59%
Max Revenue beat(4)4.87%
Revenue beat(8)7
Avg Revenue beat(8)2.14%
Revenue beat(12)11
Avg Revenue beat(12)1.8%
Revenue beat(16)15
Avg Revenue beat(16)1.85%
PT rev (1m)-6.93%
PT rev (3m)-6.93%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-7.45%
EPS NY rev (1m)-0.05%
EPS NY rev (3m)5.01%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.27%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.85%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 41.16 | ||
| Fwd PE | 29.18 | ||
| P/S | 7.49 | ||
| P/FCF | 45.25 | ||
| P/OCF | 32.13 | ||
| P/B | 7.07 | ||
| P/tB | 8.33 | ||
| EV/EBITDA | 31.09 |
EPS(TTM)3.06
EY2.43%
EPS(NY)4.32
Fwd EY3.43%
FCF(TTM)2.78
FCFY2.21%
OCF(TTM)3.92
OCFY3.11%
SpS16.81
BVpS17.82
TBVpS15.12
PEG (NY)4.36
PEG (5Y)9.69
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.61% | ||
| ROE | 17.68% | ||
| ROCE | 16.51% | ||
| ROIC | 14.07% | ||
| ROICexc | 17.03% | ||
| ROICexgc | 20.47% | ||
| OM | 19.14% | ||
| PM (TTM) | 18.75% | ||
| GM | 57.76% | ||
| FCFM | 16.56% |
ROA(3y)19.98%
ROA(5y)19.64%
ROE(3y)28.84%
ROE(5y)30.72%
ROIC(3y)25.46%
ROIC(5y)24.68%
ROICexc(3y)41.36%
ROICexc(5y)42.04%
ROICexgc(3y)57%
ROICexgc(5y)62.09%
ROCE(3y)29.86%
ROCE(5y)28.94%
ROICexcg growth 3Y-29.4%
ROICexcg growth 5Y-16.09%
ROICexc growth 3Y-24.5%
ROICexc growth 5Y-9.94%
OM growth 3Y-12.71%
OM growth 5Y-3.46%
PM growth 3Y-12.6%
PM growth 5Y-4.86%
GM growth 3Y0.12%
GM growth 5Y-0.23%
F-Score6
Asset Turnover0.73
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 158.76% | ||
| Cap/Sales | 6.76% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 99.65% | ||
| Profit Quality | 88.34% | ||
| Current Ratio | 3.09 | ||
| Quick Ratio | 2.59 | ||
| Altman-Z | 16.14 |
F-Score6
WACC15.53%
ROIC/WACC0.91
Cap/Depr(3y)132.35%
Cap/Depr(5y)130.93%
Cap/Sales(3y)4.91%
Cap/Sales(5y)5.3%
Profit Quality(3y)82.66%
Profit Quality(5y)86.05%
High Growth Momentum
Growth
EPS 1Y (TTM)0%
EPS 3Y-14.02%
EPS 5Y4.25%
EPS Q2Q%12.5%
EPS Next Y9.44%
EPS Next 2Y21.37%
EPS Next 3Y28.28%
EPS Next 5Y22.18%
Revenue 1Y (TTM)0%
Revenue growth 3Y-5%
Revenue growth 5Y4.96%
Sales Q2Q%4.77%
Revenue Next Year4.69%
Revenue Next 2Y11.87%
Revenue Next 3Y14.91%
Revenue Next 5Y11.63%
EBIT growth 1Y-5.78%
EBIT growth 3Y-17.07%
EBIT growth 5Y1.33%
EBIT Next Year40.03%
EBIT Next 3Y33.19%
EBIT Next 5Y25.36%
FCF growth 1Y-20.16%
FCF growth 3Y-14.62%
FCF growth 5Y3.26%
OCF growth 1Y-12.04%
OCF growth 3Y-12.34%
OCF growth 5Y4.18%