Teradyne Inc. (TER, Financial) has garnered attention from investors and financial analysts as a result of its strong financial position. Teradyne Inc. has experienced a daily rise of 0% with shares currently valued at $105.39, compared to a three-month change of 7.72%. Based on a comprehensive study and supported by the GF Score, Teradyne Inc. appears to be in a favorable position for significant growth shortly.
GF Rating
Through backtesting from 2006 to 2021, GuruFocus established the GF Score, a stock performance ranking system based on five characteristics of valuation that have been demonstrated to be closely connected with the long-term performances of stocks. Higher GF Score equities often yield higher returns than lower GF Score ones. Investors should therefore select equities from companies with high GF Scores. The highest rank in the GF Score is 100, and the range is 0 to 100.
Each of these elements is ranked, and there is a good correlation found between the ranks and the stocks’ long-term performance. The five essential components of analysis are used to get the GF score. We have discovered via backtesting that the performance of the stock price is influenced differently by each of these crucial factors. As a result, the weights assigned to them vary when determining the final score. Teradyne Inc. received a GF Score of 93 out of 100 from GuruFocus, indicating the strongest potential for outperformance, while having high rankings in financial health, profitability, and growth and a moderate GF Value rank.
Gratitude Teradyne Inc.’s Operations
Teradyne Inc. has a remarkable operating margin of 20.32%, with sales of $2.74 billion and a market capitalization of $16.11 billion. The company focuses on delivering testing equipment, such as wireless testing for gadgets, circuit boards, hard disk drives, and electronics systems, as well as automated test equipment for semiconductors. Teradyne Inc. has increased the range of products it offers in the industrial automation sector since joining it in 2015 by introducing collaborative and autonomous robots for use in factories. With a lot of experience in semiconductor testing, the company provides equipment to foundry, fabless, and vertically integrated chipmakers across a wide spectrum of end markets and geographical areas.
Financial Strength Analysis
Teradyne Inc.’s strong balance sheet demonstrates resilience against financial instability, indicating competent capital structure management, according to the Financial Strength assessment. Teradyne Inc.’s impressive Interest Coverage ratio of 138.71 highlights the company’s outstanding capacity to pay its interest commitments. Benjamin Graham, the renowned investor, is echoed in this strong financial position. Graham preferred enterprises with an interest coverage ratio of at least 5. Teradyne Inc.’s solid financial stability is highlighted by its good defense against financial hardship, as evidenced by its Altman Z-Score of 12.58. Teradyne Inc.’s prudent debt management, as seen by its excellent Debt-to-Revenue ratio of 0.04, strengthens its financial stability.
Profitability Rank Analysis
The Profitability Rank demonstrates Teradyne Inc.’s outstanding performance in terms of profit-making relative to its rivals. Over the last five years, Teradyne Inc.’s Operating Margin has improved; as of late, it stands at 31.50%. In addition, throughout the last five years, the company’s gross margin has consistently increased, reaching 69.27% in 2023. This pattern demonstrates the company’s increasing ability to convert revenue into profit.
Analysis of Growth Rank
Teradyne Inc., which is highly ranked in Growth, shows a strong dedication to growing its company. With a three-year revenue growth rate of 13.3%, the company beats out 52.79% of 877 Semiconductors companies. Furthermore, during the previous few years, Teradyne Inc.’s profits before interest, taxes, depreciation, and amortization (EBITDA) increased significantly. In particular, the growth rate over the last five years is 17.5, and the rate during the last three years is 14. 7. This pattern highlights the business’s ongoing capacity to spur expansion.
Next Actions
Concerning Teradyne Inc.’s profitability, growth, and financial health, the GF Score emphasizes the company’s exceptional position for future outperformance. The GF Score offers valuable insights for investors who aim to leverage the strong financial health and excellent growth trajectory of the company. GuruFocus Premium users can use the screener link below to locate more businesses with high GF Scores: GF Score Screen.
This post, produced by GuruFocus, is not intended to be personalized financial advice; rather, it is meant to offer broad ideas. Our analysis, which is based on analyst estimates and historical data using an unbiased methodology, is not meant to be used as investment advice. It makes no recommendations on which stocks to buy or sell, and it doesn’t take into account the goals or financial situation of any particular investor. Providing basic, long-term data-driven analysis is our goal. Please note that our analysis may not include the most recent announcements from companies that are price-sensitive or qualitative data. GuruFocus does not own any of the stocks listed above.