TERADYNE INC (TER)
US8807701029 - Common Stock
Taking everything into account, TER scores 6 out of 10 in our fundamental rating. TER was compared to 108 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 is not valued too expensively and it also shows a decent growth rate. With these ratings, TER could be worth investigating further 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.
In the past 5 years TER has always been profitable.
In the past 5 years TER always reported a positive cash flow from operatings.
1.2 Ratios
TER has a better Return On Assets (13.61%) than 81.48% of its industry peers.
Looking at the Return On Equity, with a value of 17.68%, TER is in the better half of the industry, outperforming 79.63% of the companies in the same industry.
The Return On Invested Capital of TER (14.07%) is better than 85.19% of its industry peers.
TER had an Average Return On Invested Capital over the past 3 years of 25.46%. This is significantly above the industry average of 11.05%.
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
The Profit Margin of TER (18.75%) is better than 76.85% of its industry peers.
In the last couple of years the Profit Margin of TER has declined.
TER has a Operating Margin of 19.14%. This is in the better half of the industry: TER outperforms 76.85% of its industry peers.
TER's Operating Margin has declined in the last couple of years.
The Gross Margin of TER (57.76%) is better than 79.63% of its industry peers.
In the last couple of years the Gross Margin of TER has remained more or less at the same level.
| 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.
Compared to 5 years ago, TER has less shares outstanding
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
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 | N/A |
ROIC/WACC0.95
WACC14.76%
2.3 Liquidity
A Current Ratio of 3.09 indicates that TER has no problem at all paying its short term obligations.
With a Current ratio value of 3.09, TER perfoms like the industry average, outperforming 54.63% of the companies in the same industry.
A Quick Ratio of 2.59 indicates that TER has no problem at all paying its short term obligations.
TER has a Quick ratio (2.59) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.09 | ||
| Quick Ratio | 2.59 |
3. Growth
3.1 Past
The earnings per share for TER have decreased by 0.00% in the last year.
Measured over the past 5 years, TER shows a small growth in Earnings Per Share. The EPS has been growing by 4.25% on average per year.
TER shows a small growth in Revenue. In the last year, the Revenue has grown by 0.00%.
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 23.34% yearly.
Based on estimates for the next years, TER will show a quite strong growth in Revenue. The Revenue will grow by 11.85% on average per year.
EPS Next Y9.5%
EPS Next 2Y21.06%
EPS Next 3Y27.39%
EPS Next 5Y23.34%
Revenue Next Year4.69%
Revenue Next 2Y11.75%
Revenue Next 3Y14.57%
Revenue Next 5Y11.85%
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
The Price/Earnings ratio is 34.48, which means the current valuation is very expensive for TER.
TER's Price/Earnings ratio is a bit cheaper when compared to the industry. TER is cheaper than 61.11% of the companies in the same industry.
TER is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.96, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 24.57 indicates a rather expensive valuation of TER.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TER indicates a somewhat cheap valuation: TER is cheaper than 63.89% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.82, TER is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.48 | ||
| Fwd PE | 24.57 |
4.2 Price Multiples
TER's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. TER is cheaper than 62.96% of the companies in the same industry.
TER's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. TER is cheaper than 70.37% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 37.91 | ||
| EV/EBITDA | 25.9 |
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.
TER has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as TER's earnings are expected to grow with 27.39% in the coming years.
PEG (NY)3.63
PEG (5Y)8.12
EPS Next 2Y21.06%
EPS Next 3Y27.39%
5. Dividend
5.1 Amount
TER has a yearly dividend return of 0.45%, which is pretty low.
In the last 3 months the price of TER has falen by -22.38%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
TER's Dividend Yield is a higher than the industry average which is at 2.37.
With a Dividend Yield of 0.45, TER pays less dividend than the S&P500 average, which is at 2.23.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.45% |
5.2 History
The dividend of TER has a limited annual growth rate of 3.94%.
TER has been paying a dividend for at least 10 years, so it has a reliable track record.
TER has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)3.94%
Div Incr Years0
Div Non Decr Years9
5.3 Sustainability
TER pays out 14.37% of its income as dividend. This is a sustainable payout ratio.
TER's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP14.37%
EPS Next 2Y21.06%
EPS Next 3Y27.39%
TERADYNE INC
NASDAQ:TER (11/21/2024, 8:00:01 PM)
Premarket: 105.55 +0.03 (+0.03%)105.52
+1.94 (+1.87%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap17.18B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.45% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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Revenue beat(2)
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.48 | ||
| Fwd PE | 24.57 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)3.63
PEG (5Y)8.12
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.61% | ||
| ROE | 17.68% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 19.14% | ||
| PM (TTM) | 18.75% | ||
| GM | 57.76% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.73
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 3.09 | ||
| Quick Ratio | 2.59 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)0%
EPS 3Y-14.02%
EPS 5Y
EPS Q2Q%
EPS Next Y9.5%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)0%
Revenue growth 3Y-5%
Revenue growth 5Y
Sales Q2Q%
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Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
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EBIT Next 5Y
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