TERADYNE INC (TER) Stock Fundamental Analysis
NASDAQ:TER - Nasdaq - US8807701029 - Common Stock - Currency: USD
Overall TER gets a fundamental rating of 7 out of 10. We evaluated TER against 109 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 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.
In the past year TER had a positive cash flow from operations.
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 (14.62%) than 86.24% of its industry peers.
TER has a better Return On Equity (19.24%) than 84.40% of its industry peers.
TER has a Return On Invested Capital of 15.72%. This is amongst the best in the industry. TER outperforms 89.91% of its industry peers.
The Average Return On Invested Capital over the past 3 years for TER is significantly above the industry average of 11.14%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.62% | ||
| ROE | 19.24% | ||
| ROIC | 15.72% |
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 19.23%, TER is in the better half of the industry, outperforming 78.90% of the companies in the same industry.
TER's Profit Margin has been stable in the last couple of years.
TER's Operating Margin of 19.58% is fine compared to the rest of the industry. TER outperforms 77.06% of its industry peers.
In the last couple of years the Operating Margin of TER has declined.
Looking at the Gross Margin, with a value of 58.48%, TER belongs to the top of the industry, outperforming 85.32% 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 | 19.58% | ||
| PM (TTM) | 19.23% | ||
| GM | 58.48% |
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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TER is still creating some value.
The number of shares outstanding for TER has been increased compared to 1 year ago.
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 9.73 indicates that TER is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 9.73, TER belongs to the top of the industry, outperforming 86.24% of the companies in the same industry.
TER has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 9.73 |
ROIC/WACC1.43
WACC11.01%
2.3 Liquidity
A Current Ratio of 2.91 indicates that TER has no problem at all paying its short term obligations.
TER's Current ratio of 2.91 is in line compared to the rest of the industry. TER outperforms 50.46% of its industry peers.
TER has a Quick Ratio of 2.43. This indicates that TER is financially healthy and has no problem in meeting its short term obligations.
TER has a Quick ratio (2.43) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.91 | ||
| Quick Ratio | 2.43 |
3. Growth
3.1 Past
TER shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 9.90%, which is quite good.
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 5.36% in the past year.
The Revenue has been growing slightly by 4.21% on average over the past years.
EPS 1Y (TTM)9.9%
EPS 3Y-18.64%
EPS 5Y2.47%
EPS Q2Q%20.25%
Revenue 1Y (TTM)5.36%
Revenue growth 3Y-8.68%
Revenue growth 5Y4.21%
Sales Q2Q%12.27%
3.2 Future
TER is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 19.90% yearly.
TER is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.96% yearly.
EPS Next Y5.35%
EPS Next 2Y25.52%
EPS Next 3Y23.38%
EPS Next 5Y19.9%
Revenue Next Year7.68%
Revenue Next 2Y14.11%
Revenue Next 3Y14.26%
Revenue Next 5Y10.96%
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
TER is valuated rather expensively with a Price/Earnings ratio of 22.13.
Based on the Price/Earnings ratio, TER is valued a bit cheaper than the industry average as 66.97% of the companies are valued more expensively.
TER's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.29.
TER is valuated rather expensively with a Price/Forward Earnings ratio of 21.00.
TER's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. TER is cheaper than 62.39% of the companies in the same industry.
TER is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 21.08, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.13 | ||
| Fwd PE | 21 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TER is valued a bit cheaper than the industry average as 66.97% of the companies are valued more expensively.
TER's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. TER is cheaper than 77.06% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.17 | ||
| EV/EBITDA | 16.09 |
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.
TER has an outstanding 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 23.38% in the coming years.
PEG (NY)4.13
PEG (5Y)8.95
EPS Next 2Y25.52%
EPS Next 3Y23.38%
5. Dividend
5.1 Amount
With a yearly dividend of 0.67%, TER is not a good candidate for dividend investing.
In the last 3 months the price of TER has falen by -48.52%. 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 2.99.
Compared to an average S&P500 Dividend Yield of 2.52, TER's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.67% |
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
TER pays out 14.09% 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.
DP14.09%
EPS Next 2Y25.52%
EPS Next 3Y23.38%
71.25
+0.09 (+0.13%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners101.1%
Inst Owner Change0.61%
Ins Owners0.15%
Ins Owner Change1.14%
Market Cap11.46B
Analysts74.29
Price Target118.21 (65.91%)
Short Float %4.23%
Short Ratio2.22
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.67% |
Yearly Dividend0.49
Dividend Growth(5Y)6.27%
DP14.09%
Div Incr Years1
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.49%
Min EPS beat(2)3.4%
Max EPS beat(2)13.57%
EPS beat(4)4
Avg EPS beat(4)20.54%
Min EPS beat(4)3.4%
Max EPS beat(4)54.36%
EPS beat(8)8
Avg EPS beat(8)18.18%
EPS beat(12)12
Avg EPS beat(12)15.93%
EPS beat(16)16
Avg EPS beat(16)13.68%
Revenue beat(2)2
Avg Revenue beat(2)1.26%
Min Revenue beat(2)0.62%
Max Revenue beat(2)1.9%
Revenue beat(4)4
Avg Revenue beat(4)2.61%
Min Revenue beat(4)0.62%
Max Revenue beat(4)4.87%
Revenue beat(8)7
Avg Revenue beat(8)1.99%
Revenue beat(12)11
Avg Revenue beat(12)1.78%
Revenue beat(16)15
Avg Revenue beat(16)1.63%
PT rev (1m)-14.53%
PT rev (3m)-13.85%
EPS NQ rev (1m)0.14%
EPS NQ rev (3m)-1.71%
EPS NY rev (1m)-14.56%
EPS NY rev (3m)-21.41%
Revenue NQ rev (1m)0.06%
Revenue NQ rev (3m)-1.7%
Revenue NY rev (1m)-6.26%
Revenue NY rev (3m)-9.88%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.13 | ||
| Fwd PE | 21 | ||
| P/S | 4.06 | ||
| P/FCF | 24.17 | ||
| P/OCF | 17.05 | ||
| P/B | 4.06 | ||
| P/tB | 4.76 | ||
| EV/EBITDA | 16.09 |
EPS(TTM)3.22
EY4.52%
EPS(NY)3.39
Fwd EY4.76%
FCF(TTM)2.95
FCFY4.14%
OCF(TTM)4.18
OCFY5.87%
SpS17.53
BVpS17.53
TBVpS14.97
PEG (NY)4.13
PEG (5Y)8.95
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.62% | ||
| ROE | 19.24% | ||
| ROCE | 17.91% | ||
| ROIC | 15.72% | ||
| ROICexc | 19.52% | ||
| ROICexgc | 23.39% | ||
| OM | 19.58% | ||
| PM (TTM) | 19.23% | ||
| GM | 58.48% | ||
| FCFM | 16.81% |
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 Turnover0.76
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 165.44% | ||
| Cap/Sales | 7.02% | ||
| Interest Coverage | 720 | ||
| Cash Conversion | 100.03% | ||
| Profit Quality | 87.41% | ||
| Current Ratio | 2.91 | ||
| Quick Ratio | 2.43 | ||
| Altman-Z | 9.73 |
F-Score7
WACC11.01%
ROIC/WACC1.43
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)9.9%
EPS 3Y-18.64%
EPS 5Y2.47%
EPS Q2Q%20.25%
EPS Next Y5.35%
EPS Next 2Y25.52%
EPS Next 3Y23.38%
EPS Next 5Y19.9%
Revenue 1Y (TTM)5.36%
Revenue growth 3Y-8.68%
Revenue growth 5Y4.21%
Sales Q2Q%12.27%
Revenue Next Year7.68%
Revenue Next 2Y14.11%
Revenue Next 3Y14.26%
Revenue Next 5Y10.96%
EBIT growth 1Y5.72%
EBIT growth 3Y-23.01%
EBIT growth 5Y0.38%
EBIT Next Year32.88%
EBIT Next 3Y29.24%
EBIT Next 5Y22.7%
FCF growth 1Y11.39%
FCF growth 3Y-21.12%
FCF growth 5Y1.31%
OCF growth 1Y14.86%
OCF growth 3Y-15.1%
OCF growth 5Y3.04%