Teradyne (TER)
NASDAQ:TER
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Teradyne
(NASDAQ:TER)
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Rating:77Outperform
Price Target:
$407.00
▲(13.60% Upside)
Action:ReiteratedDate:04/09/26
The score is driven primarily by strong underlying financial quality (profitability and low leverage) and a very positive earnings outlook tied to AI-led demand and upbeat Q1 guidance. Technicals also support the view with a clear uptrend, though momentum looks somewhat stretched. The main offset is valuation: the high P/E and minimal yield reduce margin of safety, especially given management’s noted risks around lumpiness and limited 2H 2026 visibility.
Positive Factors
Strong profitability
Sustained high gross and healthy net margins reflect durable pricing power and favorable product mix in ATE and system test. Strong margins support cash generation, reinvestment, and resilient operating profit through semiconductor cycles, underpinning long-term earnings power.
Negative Factors
Revenue lumpiness & concentration
Heavy customer concentration creates pronounced quarter-to-quarter volatility: a few large program ramps can swing revenue and margins materially. This reduces predictability of results and complicates capacity planning, cash flow timing, and investor visibility.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong profitability
Sustained high gross and healthy net margins reflect durable pricing power and favorable product mix in ATE and system test. Strong margins support cash generation, reinvestment, and resilient operating profit through semiconductor cycles, underpinning long-term earnings power.
Read all positive factors
Teradyne (TER) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$56.09B
Dividend Yield0.24%
Average Volume (3M)3.21M
Price to Earnings (P/E)54.6
Beta (1Y)1.76
Revenue Growth4.56%
EPS Growth-15.44%
CountryUS
Employees6,500
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)1.80
Shares Outstanding156,555,950
10 Day Avg. Volume2,540,448
30 Day Avg. Volume3,205,438
Financial Highlights & Ratios
PEG Ratio23.29
Price to Book (P/B)10.83
Price to Sales (P/S)9.49
P/FCF Ratio67.22
Enterprise Value/Market Cap1.00
Enterprise Value/Revenue17.60
Enterprise Value/Gross Profit30.18
Enterprise Value/Ebitda71.97
Forecast
1Y Price Target
$334.86Price Target Upside-6.54% Downside
Rating ConsensusStrong Buy
Number of Analyst Covering16
EPS Forecast (FY)6.43
Revenue Forecast (FY)$4.22B
Teradyne Business Overview & Revenue Model
Company Description
Teradyne, Inc. designs, develops, manufactures, sells, and supports automatic test equipment worldwide. The company operates through Semiconductor Test, System Test, Industrial Automation, and Wireless Test segments. The Semiconductor Test segment...
How the Company Makes Money
Teradyne makes money primarily by selling capital equipment, software, and related services across its business segments. (1) Semiconductor Test: The largest revenue stream for Teradyne is the sale of automatic test equipment (ATE) platforms and i...
Teradyne Key Performance Indicators (KPIs)
Any
Revenue by Segment
Highlights income from different business units, shedding light on which segments drive growth and profitability, and where the company might face challenges.
Highlights income from different business units, shedding light on which segments drive growth and profitability, and where the company might face challenges.
Data provided by:
The Fly
The FlyTeradyne Earnings Call Summary
Earnings Call Date:Feb 02, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 28, 2026
Earnings Call Sentiment Positive
The call presented very strong operational and financial results, led by an AI-driven surge across Semiconductor Test, with record-like quarterly revenue, large sequential growth, strong margins, robust cash generation, and an ambitious midterm target earnings model. Offsetting these positives are recurring concerns about revenue lumpiness, customer concentration, inventory write-downs, and limited visibility into the second half of 2026 (including merchant GPU timing). On balance, the highlights (broad revenue/earnings beat, AI-powered demand, clear pathway to materially higher midterm earnings, and healthy capital returns) materially outweigh the lowlights, though execution and timing risks remain.Positive Updates
Quarterly Revenue and EPS Beat
Q4 sales of $1.083 billion and non-GAAP EPS of $1.80 were both above the high end of guidance; Q4 was the highest revenue quarter of 2025 and the company's second-highest quarter ever.
Negative Updates
Revenue Lumpiness and Customer Concentration
Business remains lumpy and concentrated: in 2025 there were two specifying customers >10% and one purchasing customer >10%; management repeatedly cautioned that a few large program ramps can materially move results quarter-to-quarter and year-to-year.
Read all updates
Q4-2025 Updates
Positive
Negative
Quarterly Revenue and EPS Beat
Q4 sales of $1.083 billion and non-GAAP EPS of $1.80 were both above the high end of guidance; Q4 was the highest revenue quarter of 2025 and the company's second-highest quarter ever.
Read all positive updates
Company Guidance
Teradyne guided Q1 2026 revenue of $1.15–$1.25 billion (midpoint +11% sequential, +75% YoY) with non‑GAAP EPS of $1.89–$2.25 on ~158 million diluted shares; Q1 gross margin 58.5%–59.5% (midpoint +180 bps QoQ), OpEx up ~6% vs Q4 and running ~26%–28% of sales, and an implied non‑GAAP operating profit rate of ~32% at the midpoint. Management said AI will drive upwards of ~70% of Q1 revenue, they have a healthy backlog and expect 2026 to be front‑loaded (roughly 60% of sales in H1), and the MultiLane JV (closing H1) will be consolidated into Product Test and be accretive with de minimis EPS impact. Longer term, at an ATE TAM of $12–$14 billion they target roughly $6 billion of revenue with 59%–61% gross margin, OpEx 27%–29% of revenue, operating profit 30%–34% and non‑GAAP EPS $9.50–$11 (about 2x 2025 revenue and ~2.5x 2025 EPS).Teradyne Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
86
Very Positive
Cash Flow
67
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 3.19B | 2.82B | 2.68B | 3.16B | 3.70B |
| Gross Profit | 1.87B | 1.65B | 1.54B | 1.87B | 2.21B |
| EBITDA | 768.08M | 732.41M | 640.26M | 954.78M | 1.30B |
| Net Income | 554.05M | 542.37M | 448.75M | 715.50M | 1.01B |
Balance Sheet | |||||
| Total Assets | 4.17B | 3.71B | 3.49B | 3.50B | 3.81B |
| Cash, Cash Equivalents and Short-Term Investments | 322.00M | 599.67M | 819.73M | 894.38M | 1.37B |
| Total Debt | 347.14M | 134.54M | 147.71M | 197.06M | 240.76M |
| Total Liabilities | 1.37B | 889.42M | 960.93M | 1.05B | 1.25B |
| Stockholders Equity | 2.80B | 2.82B | 2.53B | 2.45B | 2.56B |
Cash Flow | |||||
| Free Cash Flow | 450.41M | 474.08M | 425.59M | 414.67M | 965.89M |
| Operating Cash Flow | 674.41M | 672.18M | 585.23M | 577.92M | 1.10B |
| Investing Cash Flow | -368.62M | -622.34M | -179.65M | 43.75M | 120.36M |
| Financing Cash Flow | -562.25M | -251.77M | -501.91M | -892.99M | -1.01B |
Teradyne Technical Analysis
Positive
358.29
Price Trends
300.52
Positive
249.53
Positive
185.55
Positive
Market Momentum
8.03
Negative
66.90
Neutral
89.12
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TER, the sentiment is Positive. The current price of 358.29 is above the 20-day moving average (MA) of 304.76, above the 50-day MA of 300.52, and above the 200-day MA of 185.55, indicating a bullish trend. The MACD of 8.03 indicates Negative momentum. The RSI at 66.90 is Neutral, neither overbought nor oversold. The STOCH value of 89.12 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TER.
Teradyne Risk Analysis
Teradyne disclosed 34 risk factors in its most recent earnings report. Teradyne reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Teradyne Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $56.09B | 54.64 | 19.88% | 0.24% | 4.56% | -15.44% | |
68 Neutral | $12.96B | 26.10 | 8.73% | 0.81% | 0.13% | -16.17% | |
66 Neutral | $19.70B | 54.25 | 6.12% | 0.47% | 0.59% | 25.65% | |
64 Neutral | $26.94B | 183.93 | 1.53% | ― | -16.13% | -81.06% | |
63 Neutral | $52.66B | 26.78 | 12.81% | 2.29% | 8.01% | 10.41% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
56 Neutral | $33.54B | 136.11 | 0.97% | 1.28% | -17.33% | -76.71% |
* Technology Sector Average
TER
Teradyne
358.29
279.14
352.70%
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AMKR
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ON
ON Semiconductor
68.38
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STM
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77.72%
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.