Analyst Vivek Arya from Bank of America Securities reiterated a Sell rating on Teradyne and increased the price target to $110.00 from $83.00.
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Vivek Arya has given his Sell rating due to a combination of factors influencing Teradyne’s stock performance. Despite a slight beat and miss in Q3, the stock has risen by 20% largely due to optimism surrounding potential new business opportunities. These include the possibility of securing additional GPU testing business from NVIDIA, involvement in Apple’s 2nm product ramp, and incremental gains in robotics. However, Arya notes that these opportunities are speculative and their realization is uncertain, particularly the NVIDIA win, which is somewhat binary in nature.
Furthermore, Arya highlights that the current valuation of Teradyne’s stock is at a premium, trading at 26 times the estimated earnings for 2026, which is higher than its peers. This premium is not justified given the limited visibility in robotics and mobility demands, and the uncertain timing of potential business wins. Arya also suggests that there are more direct and attractive investment opportunities in the AI sector, as outlined in their recent report on top AI picks.
According to TipRanks, Arya is a top 100 analyst with an average return of 20.4% and a 64.19% success rate. Arya covers the Technology sector, focusing on stocks such as Advanced Micro Devices, Nvidia, and Analog Devices.
In another report released yesterday, Goldman Sachs also maintained a Sell rating on the stock with a $85.00 price target.