Teradata (TDC) AI Stock Analysis

• Market Cap: $1.94B
• Dividend Yield: N/A
• Average Volume (3M): 1.02M
• Price to Earnings (P/E): 18.6
• Beta (1Y): 0.99
• Revenue Growth: -6.74%
• EPS Growth: 80.49%
• Country: US
• Employees: 5,700
• Sector: Technology
• Sector Strength: 85
• Industry: Software - Infrastructure
• EPS (TTM): 0.47
• Shares Outstanding: 94,500,000
• 10 Day Avg. Volume: 847,290
• 30 Day Avg. Volume: 1,023,893
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.21
• Enterprise Value/Revenue: 1.41
• Enterprise Value/Gross Profit: 2.39
• Enterprise Value/Ebitda: 9.54
• 1Y Price Target: $23.17
• Price Target Upside: 9.81% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 6

• Rating: 62 Neutral
• Price Target: $22.00 ▲(4.27% Upside)

Teradata's overall score reflects strong profitability and strategic initiatives in AI and cloud, offset by declining revenue and high leverage. Technical indicators and valuation suggest moderate market positioning, with earnings call insights providing a balanced outlook.

Positive Factors

AI Capabilities

A top healthcare provider and several large international clients are using Teradata's advanced AI features, indicating strong product capabilities.

Cloud Performance

Cloud ARR growth of 15% was 5 points above expectations and strengthened the investment thesis.

Strategic Partnerships

Teradata announced its partnership with NVIDIA, using NVIDIA's NeMo Retriever to enable customers to use information and insights from unstructured data sources and build RAG-based applications.

Negative Factors

Executive Departure

Teradata's CFO recently departed the company, leaving open a key c-suite role.

Market Valuation

The stock is down 26% YTD and 40% over the last 12 months, with short interest near a 12-month high.

Revenue Guidance

FY25 guide for total cc rev growth was lowered by 1pp to -5% to -7% growth, marking two consecutive qtrs of lowered guide.

Teradata Business Overview & Revenue Model

Company Description

Teradata Corporation, together with its subsidiaries, provides a connected multi-cloud data platform for enterprise analytics. The company offers Teradata Vantage, a data platform that allows companies to leverage their data across an enterprise, as well as connects various sources of data to drive ecosystem simplification and support customers on their journey to the cloud through an integrated migration. Its business consulting services include support services for organizations to establish a data and analytic vision, and identify and operationalize analytical opportunities, as well as enable a multi-cloud ecosystem architecture and ensure the analytical infrastructure delivers value. In addition, it offers support and maintenance services. The company serves clients in financial services, government, healthcare, manufacturing, retail, telecommunications, and travel/transportation sectors through a direct sales force in the Americas, Europe, the Middle East, Africa, the Asia Pacific, and Japan. Teradata Corporation was incorporated in 1979 and is headquartered in San Diego, California.

How the Company Makes Money

Teradata generates revenue through a combination of software licensing, cloud services, and consulting services. The primary revenue streams include software sales, which encompass both on-premises licenses and cloud subscriptions, as well as maintenance and support services for its products. Consulting services represent another significant revenue source, as the company assists clients in implementing and optimizing their data analytics solutions. Additionally, Teradata has formed strategic partnerships with major cloud providers, enabling the company to expand its cloud offerings and reach a broader customer base, further enhancing its revenue potential.

Teradata Financial Statement Overview

Summary

Teradata shows strong profitability with a high gross profit margin and improved net profit margin. However, declining revenue growth and high leverage are significant concerns, impacting financial stability.

Income Statement

Teradata's income statement shows a mixed performance. The TTM (Trailing-Twelve-Months) gross profit margin is strong at 60.07%, indicating efficient cost management. However, the revenue growth rate is negative at -1.64%, suggesting a decline in sales. The net profit margin improved to 8.10% in TTM, reflecting better profitability. EBIT and EBITDA margins are healthy, but the declining revenue growth is a concern.

Balance Sheet

The balance sheet reveals high leverage with a TTM debt-to-equity ratio of 3.72, indicating significant reliance on debt financing. Return on equity is low at 1.12%, suggesting limited returns for shareholders. The equity ratio is not provided, but the high debt levels pose a risk to financial stability.

Cash Flow

Cash flow analysis shows a positive trajectory with a TTM free cash flow growth rate of 1.42%. The operating cash flow to net income ratio is 0.30, and the free cash flow to net income ratio is 0.99, indicating strong cash generation relative to net income. This suggests good liquidity and cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.68B	1.75B	1.83B	1.79B	1.92B	1.84B
Gross Profit	987.00M	1.06B	1.12B	1.08B	1.19B	1.02B
EBITDA	247.00M	293.00M	262.00M	223.00M	231.00M	171.00M
Net Income	110.00M	114.00M	62.00M	33.00M	147.00M	129.00M
Balance Sheet
Total Assets	1.74B	1.70B	1.87B	2.02B	2.17B	2.19B
Cash, Cash Equivalents and Short-Term Investments	369.00M	420.00M	486.00M	569.00M	592.00M	529.00M
Total Debt	583.00M	576.00M	640.00M	637.00M	572.00M	643.00M
Total Liabilities	1.56B	1.57B	1.74B	1.76B	1.71B	1.79B
Stockholders Equity	176.00M	133.00M	135.00M	258.00M	460.00M	400.00M
Cash Flow
Free Cash Flow	285.00M	277.00M	355.00M	403.00M	432.00M	216.00M
Operating Cash Flow	284.00M	303.00M	375.00M	419.00M	463.00M	267.00M
Investing Cash Flow	-25.00M	-32.00M	-49.00M	-18.00M	-31.00M	-51.00M
Financing Cash Flow	-205.00M	-306.00M	-383.00M	-381.00M	-356.00M	-186.00M

Teradata Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 21.10
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TDC, the sentiment is Neutral. The current price of 21.1 is above the 20-day moving average (MA) of 20.84, below the 50-day MA of 21.57, and below the 200-day MA of 25.04, indicating a neutral trend. The MACD of -0.18 indicates Negative momentum. The RSI at 49.55 is Neutral, neither overbought nor oversold. The STOCH value of 44.96 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TDC.

Teradata Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HOOD	78 Outperform	$96.69B	55.26	23.54%	―	58.58%	508.72%
MDB	76 Outperform	$17.51B	―	-3.65%	―	21.90%	67.81%
FOUR	73 Outperform	$7.91B	33.46	19.00%	―	23.86%	79.35%
ZS	72 Outperform	$41.68B	―	-2.68%	―	25.46%	49.20%
S	64 Neutral	$5.46B	―	-26.98%	―	28.19%	-31.34%
TDC	62 Neutral	$1.94B	18.64	87.65%	―	-6.74%	80.49%
Sector *	54 Neutral	$298.66M	3.86	-5.40%	2.71%	9.11%	-73.63%

Teradata Corporate Events

Teradata Stockholders Approve Amended Stock Incentive Plan

On May 15, 2025, Teradata Corporation’s stockholders approved the Amended 2023 Stock Incentive Plan, increasing the available shares by 3,687,000. During the Annual Meeting, stockholders also elected three Class III directors, approved executive compensation, and ratified PricewaterhouseCoopers LLP as the independent auditor for 2025, reflecting strong shareholder engagement and support for the company’s strategic initiatives.

The most recent analyst rating on (TDC) stock is a Hold with a $40.00 price target. To see the full list of analyst forecasts on Teradata stock, see the TDC Stock Forecast page.

Teradata Launches 2025 Employee Stock Inducement Plan

On May 14, 2025, Teradata‘s Board of Directors approved the Teradata 2025 New Employee Stock Inducement Plan (NESIP), effective May 15, 2025. This plan allows the company to offer equity incentives to new employees as an inducement to join Teradata, in accordance with NYSE rules. The NESIP includes a reserve of 1 million shares for various stock-based awards and is managed by the Compensation and People Committee. It is set to terminate on May 15, 2027, unless ended earlier by the Board, and does not require stockholder approval.

The most recent analyst rating on (TDC) stock is a Hold with a $40.00 price target. To see the full list of analyst forecasts on Teradata stock, see the TDC Stock Forecast page.