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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Teradyne, Inc. (XNAS:TER) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
TER
Name:
TERADYNE, INC. (XNAS:TER)
Sector:
- 36537.00K
Industry:
Semiconductor Equipment & Materials
CEO:
Mr. Mark Jagiela
Total Employees:
5,900
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -78.55% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF TERADYNE, INC.(TER) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SEMICONDUCTOR EQUIPMENT & MATERIALS INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
83.04
One Month Price Target:
$83.76
Six Month Price Target :
$87.36
Likely Price in One Year's Time:
Ticker:
$91.67
Likely Trading Range Today Under (Normal Volatility)
$82.67
Price Upper limit ($) :
$83.55
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$77.76
This week:
$71.24
This month :
$59.44
Other Primary facts
Market Cap:
13.00B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
156.78M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
14.9%
-22.41%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$107.52
$96.23
$58.56
$69.85
Medium risk (<10%) entry points
Buy Call
Sell Call
$92.56
Buy Put:
Sell Put:
$90.15
$73.49
$75.93
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
TER
Sharpe Ratio:
2.40%
Comparison:
TER, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is -13.48% lower than the industry
& ratio is 5.30% higher than the market/S&P 500 average
Average Returns/Yield of
TER
Daily returns:
0.08%
Weekly returns:
0.42%
Monthly returns:
1.68%
Yearly returns:
28.31%
Comparison of returns:
Average annual returns/yield (last 3 years) is -28.71% below industry average
Classification:
TER, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.91
Statistical test of Returns:
TER has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.13%
Weekly Volatility:
7.01%
Monthly Volatility:
14.02%
Yearly Volatility:
48.57%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.18%
Volatility in last five trading days has been -62.34% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.35%
Weekly VaR:
-14.21%
Monthly VaR:
-28.42%
How Much Can the price of
TER
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-24%
Worst case (decline):
>85%
This translates to price declining to:
$62.97
This translates to price declining to:
$12.46
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
TER is a 100.57% riskier investment compared to the market/S&P 500 & is 71.83% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -16.30% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
TER
Beta in relation to market/S&P 500--1.55
Expected beta in 1 year's time:
1.165
Expected beta in 3 year's time:
1.647
Unlevered (debt free) Beta:
1.479
Beta in relation to Nasdaq (XNAS):
1.331
Beta in relation to all global stocks::
0.859
Beta Comparison & Analysis
Beta of competitors/peers::
1.25
Beta is 23.72% higher than peers
Average Industry Beta:
1.394
Beta is 10.93% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
38.35%
Sustainable growth rate is 49.04% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.064
Alpha is -58.75% below industry average alpha yield
Alpha is 410% higher than market/& is unsustainably high
Analysis of Cost of Capital of
TER
Equity cost of capital:
0.137
Equity cost of capital is 8.22% above industry mean WACC
Unlevered (without debt) cost of capital:
13.14%
Before-tax cost of debt:
7.53%
After-tax cost of debt:
5.95%
Overall debt rating:
Non-investment grade (junk/speculative grade
Weighted average cost of capital (WACC):
5.95%
WACC is 25.73% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$23.45
Revenue growth rate per share of (3Y):
5.26
Annual revenue growth rate is 73.90% above the industry average
EPS:
$5.35
Expected Annual growth rate of EPS (3Y):
25.32%
Expected future EPS growth rate is -18.52% lower than the Semiconductor Equipment & Materials industry
Free cash flow (FCF) per share:
$5.99
Balance sheet equity growth per share: 10.72%
Equity growth rate per share is -54.72% lower than the industry
Debt per share
$0.84
EBITDA per share
$7.97
Valuation Analysis Today of
TER
P/E Ratio:
17.49
P/E Ratio of Competitors/Peers:
21.43
P/E ratio is -18.36% lower than main peers & is -39.05% lower than the industry
Stock price/value with industry average P/E ratio: $153.54
TER is -45.92% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $16.29
Present value of the expected future dividends only: $3.69
P/S (Price to Sales ratio):
3.54
Price to sales ratio is -44.68% below the industry mean
P/B (Price to book value ratio):
5.26
Price to free cash flow: 13.86
-
Net income growth rate (3Y):
153.71%
Net income growth rate is -77.53% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 1.84%
Dividend yeild: 0.51%
Previous Dividend: $0.11
Previous adjusted dividend: $0.11
Previous Dividend: $0.42
Expected next dividend best case: $0.11
Expected next dividend worst case: $0.11
Average dividend payment (long-term): $0.10
Average dividend increase/decrease (growth rate) % per period: 2.11%
Expected next dividend payment date: 15/09/2022
Expected next dividend record date: 23/08/2022
Expected next dividend declaration date: 08/10/2022
Previous dividend payment date: 17/06/2022
Previous dividend record date: 25/05/2022
Previous dividend declaration date: 05/12/2022
Dividend History:
2022-05-24--$0.11
2021-11-23--$0.10
2021-05-25--$0.10
2022-02-17--$0.11
2021-08-31--$0.10
2021-02-18--$0.10
Dividend growth rate is -120.46% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
5.31%
Net debt to equity ratio:
-25.23%
Debt to assets ratio:
3.64%
Net debt to assets ratio:
-17.30%
Debt-to-asset ratio is -92.70% below industry average
Ability to repay debt:
Interest coverage ratio:
97.41
Interest coverage ratio is 400.77% more than industry average
Looking forward:
Debt growth rate:
-54.99%
Annual debt growth is -6993% lower than industry average debt growth rate
Debt repayment rate in last quarter: 13.61%
Analysis of Key Statistics
Correlation of price movement with the market:
0.724
Statistical significance of correlation:
TER has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.604
Stock price is 19.98% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.604
Correlation of price movement with Nasdaq (^IXIC):
-0.014
Covariance of price movement with the market:
-0.026
Kurtosis
4.934
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.451
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
TER
Gross Profit Margin Ratio:
239%
Operating Profit Margin Ratio:
31.38%
Operating profit margin is -798.97% lower than the industry
Net Profit Margin Ratio:
239%
Effective Tax Rate:
13.10%
Effective tax rate is 0.69% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
39.24%
Return on equity (ROE) is 176.00% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
26.90%
Return on assets (ROA) is 211.88% higher than the industry
Financial Leverage:
1.0x
Current Ratio:
3.33
Current ratio is -24.03% below industry average
Cash Conversion Cycle (days):
31.6
Cash conversion cycle is -45.80% below industry average
The remaining useful life of property plant & equipment is: 6.2 years
Stock based compensation to net income ratio:
1.33%
In-depth Efficiency Analysis
Revenue generated per employee:
623.2K
Each employee generates 6% more revenue than industry average revenue per employee
EBITDA generated per employee:
211.8K
Each employee generates 26% more EBITDA than industry average revenue per employee
Profit generated per employee:
164.6K
Each employee generates 51% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 6.2K
Each employee generates -136% less free cash flow than industry average revenue per employee
Assets/Capital per employee
209.3K
Each employee generates -136% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
TER
SKYWORKS SOLUTIONS, INC. (XNAS:SWKS)
VERISIGN, INC. (XNAS:VRSN)
Garmin Ltd (XNYS:GRMN)
DOCUSIGN, INC. (XNAS:DOCU)
CDW CORPORATION (XNAS:CDW)
MXIM
ON SEMICONDUCTOR CORPORATION (XNAS:ON)
ZEBRA TECHNOLOGIES CORPORATION (XNAS:ZBRA)
MONGODB, INC. (XNAS:MDB)
Current Analyst Ratings
Strong buy�17%
Buy�17%
Hold�25%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
4/3/22
Revenue:
3.68B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
1.48B
2.20B
435.32M
-
557.95M
-
20.98M
1.01B
2.52M
12.83M
119.49M
1.25B
1.15B
971.01M
1.12B
146.32M
971.01M
Statement of Cash Flow
Date:
Period:
27.74M
Differed Income Tax :
11.29M
Stock Based Compensation :
12.89M
Change in Working Capital :
- 208823.00K
Accounts Receivables:
208.00K
Other Working Capital:
- 864.00K
Other Non-Cash Items:
2.44M
Net Cash Provided by Operating Activities:
7.46M
Investments in PP&E:
- 43999.00K
Net Acquisitions:
-
Purchases of Investments:
- 165977.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
4/3/22
2022
Q1
794.60M
282.02M
1.08B
546.88M
259.34M
491.54M
2.37B
467.20M
419.89M
69.85M
126.13M
113.56M
38.15M
1.23B
-
3.61B
156.49M
39.02M
103.39M
155.76M
360.93M
712.20M
131.31M
234.49M
422.42M
-
1.13B
20.13M
762.19M
- 19479.0K
-
April 3, 2022 at 6:00:00 AM
2.49B
2.47B
3.61B
408.15M
170.33M
- 624271.0K
127.26M
-
- 82713.00K
- 20694.00K
-
- 201465.00K
- 17895.00K
- 14573.00K
- 254627.00K
2.28M
- 327596.00K
794.60M
1.12B
7.46M
- 43999.00K
- 36537.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
TER
2023
2024
2025
2026
2027
$92.13
$135.26
$149.32
$164.84
$181.98