TER Teradyne Inc

Teradyne is a leading supplier of automated test equipment used to test semiconductors, storage devices, network equipment, and wireless devices. Sector: Technology.

Teradyne Inc (TER) is an individual stock. The analysis below presents key financial metrics for the company, covering profitability, capital efficiency, valuation, margins, and growth.

Looking at how effectively the company deploy capital, ROIC is 20.89%, WACC is 14.49%, and the economic spread is 6.40%. On balance, the spread between ROIC and WACC is narrow, leaving little buffer but still pointing to net positive value generation. Supporting metrics show ROE at 19.78% and ROA at 12.59%, a combination that helps frame whether profitability strength is broad enough to hold through different market conditions. Taken together, the return profile suggests a company that is value-creative but with less room for execution slippage.

On valuation, the company registers trailing P/E of 89.10, forward P/E of 49.51, PEG of 1.95. Forward P/E is considerably lower than trailing, which indicates earnings estimates are pointing higher — a dynamic that makes current prices look more reasonable on a prospective basis. The PEG reading here implies the market is pricing growth at roughly fair value — a setup where the investment case depends more on execution than on multiple expansion. A current ratio reading of 1.75 points to the company that are managing short-term obligations without apparent stress. Taken together, the multiple and liquidity picture suggests a company that is priced for a constructive outcome — but where execution against earnings estimates will be the key determinant of whether that price is justified.

Across the three margin layers, gross margin sits at 58.22%, operating margin at 21.52%, and free cash flow margin at 14.12%. Gross margins sit in a healthy range, consistent with businesses that manage input costs effectively. Operating margins are in good shape, consistent with businesses that maintain reasonable earnings conversion after overhead. At this level, free cash flow generation is present but not a defining strength of the company's underlying businesses. This margin configuration supports a cautious interpretation: profitability exists, though durability is less certain under stress.

Two key indicators frame the near-term view: TTM revenue growth of 43.89% a signal of strong operational momentum across the company, while the estimated 12-month price change of -6.87%, where implied returns are negative based on the present target distribution. The near-term return case is built on whether reported trends and analyst projections can remain close enough to make current prices look justified. Whether the setup resolves positively or negatively will depend as much on the macro backdrop as on the capacity of the company to deliver against current estimates. The estimated 12-month price change is based on analyst consensus price target estimates, sourced from publicly available data, and should not be interpreted as a reliable prediction of future performance.

Balancing the strengths against the areas of uncertainty, the weight of evidence favors an optimistic view with appropriate risk awareness.

This assessment is based solely on the quantitative metrics presented above and does not constitute financial advice. Investors should consider their own risk tolerance and conduct independent research before making investment decisions.