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Teradata
(NYSE:TDC)
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Rating:77Outperform
Price Target:
$39.00
▲(36.75% Upside)
Action:Reiterated
Date:08/05/26
The score is driven primarily by improved financial performance (sharp margin expansion, strong free cash flow, and a de-risked balance sheet) and attractive valuation (low P/E). Offsetting factors include mixed technical momentum signals and near-term headwinds highlighted on the earnings call (weak Q3 outlook/linearity and consulting softness), which temper an otherwise improving fundamental picture.
Positive Factors
Cash Generation
Teradata's exceptional cash conversion (free cash flow near 98% of net income and $746M TTM) creates durable financial flexibility. This funds buybacks and debt paydown, supports reinvestment in product and go-to-market, and buffers the business against cyclical downturns without relying on new external financing.
Negative Factors
Uneven Historical Revenue Momentum
Prior multi-year revenue declines highlight that the recent rebound may not yet be entrenched. If ARR or cloud adoption stalls, the margin and cash-flow gains could reverse. Durable growth requires consistent multi-quarter ARR and cloud expansion to sustain the improved profitability profile.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash Generation
Teradata's exceptional cash conversion (free cash flow near 98% of net income and $746M TTM) creates durable financial flexibility. This funds buybacks and debt paydown, supports reinvestment in product and go-to-market, and buffers the business against cyclical downturns without relying on new external financing.
Read all positive factors
Teradata Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down Teradata's revenue across regions to show where sales and growth are concentrated, revealing exposure to local economic cycles, currency swings, or dependence on large regional customers.
Breaks down Teradata's revenue across regions to show where sales and growth are concentrated, revealing exposure to local economic cycles, currency swings, or dependence on large regional customers.
Data provided by:
The Fly
The FlyTeradata (TDC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.92B
Dividend YieldN/A
Average Volume (3M)3.32M
Price to Earnings (P/E)6.9
Beta (1Y)0.89
Revenue Growth-0.82%
EPS Growth213.63%
CountryUS
Employees5,100
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)4.51
Shares Outstanding94,100,000
10 Day Avg. Volume2,804,630
30 Day Avg. Volume3,323,958
Financial Highlights & Ratios
PEG Ratio1.30
Price to Book (P/B)12.49
Price to Sales (P/S)1.73
P/FCF Ratio10.05
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$33.50Price Target Upside17.46% Upside
Rating ConsensusHold
Number of Analyst Covering6
EPS Forecast (FY)2.67
Revenue Forecast (FY)$1.65B
Teradata Business Overview & Revenue Model
Company Description
Teradata Corporation, through its various entities, delivers a unified multi-cloud data platform specifically engineered for robust enterprise analytics. A cornerstone of its product suite is Teradata Vantage, a cutting-edge data platform designed...
How the Company Makes Money
Teradata primarily makes money by selling subscriptions to its software and cloud offerings, along with associated support and services. Its core revenue stream is recurring subscription revenue from customers who license and consume Teradata’s an...
Teradata Earnings Call Summary
Earnings Call Date:Aug 04, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 09, 2026
Earnings Call Sentiment Positive
The call emphasized strong execution across product innovation, margin expansion, cash generation, and balance sheet improvement, alongside meaningful early customer traction for new AI-focused offerings. Near-term headwinds stem from consulting revenue weakness, ASC 606-related revenue timing that pressures H2 revenue linearity, and potential supply-chain/cost risks for on-prem hardware as Teradata Factory scales. On balance, the positives — product momentum, profitability gains, cash flow, and strategic positioning for agentic AI — outweigh the near-term operational and timing challenges, supporting confidence in the full-year targets.Positive Updates
Recurring Revenue Growth and Stability
Recurring revenue reached $363 million, up 3% year-over-year (2% in constant currency), marking the third consecutive quarter of positive recurring revenue growth and exceeding the high end of guidance by ~3 percentage points.
Negative Updates
Consulting Services Revenue Decline
Consulting services revenue was $39 million in Q2, down 24% year-over-year (23% in constant currency). Consulting gross margin was flat and the segment's revenue softness pressured overall margins; bookings have improved but revenue remains weak.
Read all updates
Q2-2026 Updates
Positive
Negative
Recurring Revenue Growth and Stability
Recurring revenue reached $363 million, up 3% year-over-year (2% in constant currency), marking the third consecutive quarter of positive recurring revenue growth and exceeding the high end of guidance by ~3 percentage points.
Read all positive updates
Company Guidance
Management reaffirmed its full‑year outlook for total ARR, total revenue and recurring revenue while raising FY non‑GAAP EPS to $2.65–$2.73 and increasing adjusted free cash flow guidance to $330–$350 million; for Q3 they expect recurring revenue down 4% to 2% YoY, total revenue down 6% to 4% YoY, and non‑GAAP diluted EPS of $0.55–$0.59 (non‑GAAP tax rate ~23%, weighted average shares ~96.7M, FY other expenses ≈$19M). They noted Q2 actuals of total revenue $410M (flat YoY), recurring revenue $363M (+3% YoY, +2% CC), total ARR +1% (+2% CC), cloud ARR +8% (+9% CC), Q2 non‑GAAP EPS $0.69, adjusted free cash flow $127M, net cash $323M (up $528M YoY), ~$40M of share repurchases (~1.3M shares) and payoff of the remaining $450M term loan, and said they expect modest sequential ARR growth into Q3 with the majority of ARR growth concentrated in Q4.Teradata Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
71
Positive
Cash Flow
86
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.69B | 1.66B | 1.75B | 1.83B | 1.79B | 1.92B |
| Gross Profit | 1.02B | 993.00M | 1.06B | 1.11B | 1.08B | 1.19B |
| EBITDA | 671.00M | 268.00M | 293.00M | 263.00M | 225.00M | 367.00M |
| Net Income | 421.00M | 130.00M | 114.00M | 62.00M | 33.00M | 147.00M |
Balance Sheet | ||||||
| Total Assets | 2.14B | 1.78B | 1.70B | 1.87B | 2.02B | 2.17B |
| Cash, Cash Equivalents and Short-Term Investments | 816.00M | 493.00M | 420.00M | 486.00M | 569.00M | 592.00M |
| Total Debt | 553.00M | 561.00M | 576.00M | 640.00M | 637.00M | 572.00M |
| Total Liabilities | 1.58B | 1.55B | 1.57B | 1.74B | 1.76B | 1.71B |
| Stockholders Equity | 557.00M | 230.00M | 133.00M | 135.00M | 258.00M | 460.00M |
Cash Flow | ||||||
| Free Cash Flow | 679.00M | 286.00M | 277.00M | 355.00M | 403.00M | 432.00M |
| Operating Cash Flow | 698.00M | 305.00M | 303.00M | 375.00M | 419.00M | 463.00M |
| Investing Cash Flow | -31.00M | -21.00M | -32.00M | -49.00M | -18.00M | -31.00M |
| Financing Cash Flow | -227.00M | -233.00M | -306.00M | -383.00M | -381.00M | -356.00M |
Teradata Technical Analysis
Positive
28.52
Price Trends
32.56
Positive
30.20
Positive
29.34
Positive
Market Momentum
-0.26
Negative
62.51
Neutral
93.20
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TDC, the sentiment is Positive. The current price of 28.52 is below the 20-day moving average (MA) of 31.19, below the 50-day MA of 32.56, and below the 200-day MA of 29.34, indicating a bullish trend. The MACD of -0.26 indicates Negative momentum. The RSI at 62.51 is Neutral, neither overbought nor oversold. The STOCH value of 93.20 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TDC.
Teradata Risk Analysis
Teradata disclosed 26 risk factors in its most recent earnings report. Teradata reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Teradata Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $18.72B | 46.10 | 20.74% | ― | 23.44% | 151.36% | |
77 Outperform | $2.92B | 6.87 | 142.47% | ― | -0.82% | 213.63% | |
73 Outperform | $7.33B | 17.60 | -28.45% | ― | -0.62% | 20.48% | |
70 Outperform | $16.75B | 38.27 | 9.12% | ― | 6.15% | 0.30% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
60 Neutral | $4.20B | 59.15 | 6.42% | ― | 28.28% | -72.43% |
* Technology Sector Average
TDC
Teradata
34.39
14.16
70.00%
AKAM
Akamai
123.35
49.70
67.48%
DBX
Dropbox
34.51
8.38
32.07%
FOUR
Shift4 Payments
55.61
-30.82
-35.66%
TOST
Toast Inc
33.81
-13.90
-29.13%
Teradata Corporate Events
Business Operations and StrategyExecutive/Board Changes
Teradata Adds Veteran Technologist Bernd Leukert to Board
Positive
Aug 3, 2026
Teradata has appointed veteran technology executive Bernd Leukert to its Board of Directors, effective August 1, 2026, expanding the board from nine to ten members as part of an ongoing refreshment plan announced earlier in the year. Leukert, desi...
Business Operations and StrategyPrivate Placements and Financing
Teradata Establishes New $400 Million Revolving Credit Facility
Neutral
Jun 24, 2026
On June 24, 2026, Teradata entered into a new Credit Agreement with a syndicate of lenders led by Bank of America, N.A., establishing a five-year unsecured revolving credit facility of up to $400 million, with sublimits for standby letters of cred...
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
Teradata Shareholders Approve Expanded Stock Incentive Plan
Positive
May 19, 2026
On May 14, 2026, Teradata stockholders approved an amended and restated 2023 Stock Incentive Plan that increases the number of shares available for equity awards by 6.3 million, expanding the company’s capacity to use stock-based compensatio...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.