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Teradata
(NYSE:TDC)
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Rating:78Outperform
Price Target:
$42.00
▲(54.98% Upside)
Action:Reiterated
Date:05/20/26
The score is driven primarily by improved financial performance and standout recent cash generation, reinforced by an exceptionally low P/E valuation. Offsetting these positives are guidance implying FY2026 revenue pressure and some reliance on upfront revenue timing (creating volatility), while technically the stock is in a strong uptrend but showing somewhat stretched momentum indicators.
Positive Factors
Free cash flow strength
Sustained, high cash conversion gives Teradata durable financial flexibility to fund product R&D, repay debt, and support capital allocation (buybacks/dividends). Strong operating cash flow underpins resilience through cycles and reduces reliance on external financing for strategic investments.
Negative Factors
FY2026 revenue guidance weakness
Management's guidance implies top‑line pressure that can constrain investment for growth and slow ARR momentum. Prolonged revenue headwinds could force tougher tradeoffs between margin preservation and go‑to‑market spending, limiting sustainable scale in coming quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Free cash flow strength
Sustained, high cash conversion gives Teradata durable financial flexibility to fund product R&D, repay debt, and support capital allocation (buybacks/dividends). Strong operating cash flow underpins resilience through cycles and reduces reliance on external financing for strategic investments.
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
$3.31B
Dividend YieldN/A
Average Volume (3M)3.00M
Price to Earnings (P/E)7.8
Beta (1Y)0.86
Revenue Growth-0.82%
EPS Growth213.63%
CountryUS
Employees5,700
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)4.51
Shares Outstanding94,100,000
10 Day Avg. Volume4,244,932
30 Day Avg. Volume2,997,350
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 Cap0.82
Enterprise Value/Revenue1.61
Enterprise Value/Gross Profit2.68
Enterprise Value/Ebitda4.06
Forecast
1Y Price Target
$34.14Price Target Upside25.99% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)2.65
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:May 05, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 10, 2026
Earnings Call Sentiment Positive
Overall the call conveyed a positive operational and financial start to FY2026 driven by strong recurring revenue growth, notable margin expansion, meaningful cash and balance sheet improvement from the SAP settlement, robust AI product momentum, and several strategic customer wins. The company also highlighted near-term and medium-term headwinds: FY2026 guidance implies revenue/recurring pressure, Q2 sequential normalization from upfront revenue will be a headwind, adjusted free cash flow excluding the settlement remains modest, consulting services revenue declined, and rising memory/hardware costs pose a risk into FY2027. On balance, the positive execution, margin expansion, product and customer momentum, and strengthened balance sheet outweigh the listed challenges.Positive Updates
Strong Revenue and Recurring Revenue Growth
Total revenue of $444M in Q1, up 6% year-over-year (4% in constant currency). Recurring revenue was $400M, up 12% year-over-year (9% in constant currency), driven by upfront on-prem subscription term license revenue that added ~5 points to recurring growth.
Negative Updates
Guidance Implies Revenue and Recurring Pressure for FY2026
Company reaffirmed full-year ranges that imply softness: recurring revenue expected -2% to flat YoY for FY2026 and total revenue expected -4% to -2% YoY, signaling expected headwinds in the back half of the year.
Read all updates
Q1-2026 Updates
Positive
Negative
Strong Revenue and Recurring Revenue Growth
Total revenue of $444M in Q1, up 6% year-over-year (4% in constant currency). Recurring revenue was $400M, up 12% year-over-year (9% in constant currency), driven by upfront on-prem subscription term license revenue that added ~5 points to recurring growth.
Read all positive updates
Company Guidance
Teradata reaffirmed its 2026 outlook while providing detailed modeling assumptions: full‑year total ARR is expected to grow about 2%–4% (Q1 total ARR +3% reported / +2% constant currency) with total ARR stabilizing in Q2 and modest sequential dollar growth thereafter; recurring revenue is guided to -2% to flat year‑over‑year and total revenue to -4% to -2% (Q1 total revenue was $444M, +6% YoY; Q1 recurring revenue $400M, +12% YoY); non‑GAAP diluted EPS guidance was cited around $2.53–$2.57 (management also referenced a $2.55–$2.65 range and said they expect to be toward the higher end); adjusted free cash flow was raised to $320M–$340M (this excludes the $302M after‑tax benefit from the SAP settlement); additional assumptions include roughly 100 basis points of operating margin expansion in FY26, Q2 non‑GAAP tax rate ≈24%, weighted average shares ≈96.3M, FY other expenses ≈$22M, minimal full‑year FX impact to revenue, and a >10‑point sequential headwind to recurring revenue growth from Q1 to Q2 due to upfront term license recognition (with ~3 points of FX headwind noted).Teradata Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
58
Neutral
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
27.10
Price Trends
32.37
Positive
30.08
Positive
28.48
Positive
Market Momentum
0.86
Negative
58.42
Neutral
82.90
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 27.1 is below the 20-day moving average (MA) of 33.20, below the 50-day MA of 32.37, and below the 200-day MA of 28.48, indicating a bullish trend. The MACD of 0.86 indicates Negative momentum. The RSI at 58.42 is Neutral, neither overbought nor oversold. The STOCH value of 82.90 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 |
|---|---|---|---|---|---|---|---|
78 Outperform | $3.31B | 7.80 | 142.47% | ― | -0.82% | 213.63% | |
75 Outperform | $17.10B | 42.30 | 20.74% | ― | 23.44% | 151.36% | |
73 Outperform | $6.49B | 15.58 | -28.45% | ― | -0.62% | 20.48% | |
70 Outperform | $18.40B | 42.05 | 9.12% | ― | 6.15% | 0.30% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
57 Neutral | $3.79B | 53.35 | 6.42% | ― | 28.28% | -72.43% |
* Technology Sector Average
TDC
Teradata
35.17
12.44
54.73%
AKAM
Akamai
126.57
45.94
56.98%
DBX
Dropbox
28.83
1.15
4.15%
FOUR
Shift4 Payments
47.82
-56.72
-54.26%
TOST
Toast Inc
28.57
-16.07
-36.00%
Teradata Corporate Events
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.