With a market cap of $14.1 billion, Teradyne, Inc. (TER) is a leading U.S.-based technology firm specializing in automated test equipment (ATE) and industrial robotics. Founded in 1960 and headquartered in North Reading, Massachusetts, the company supports high-tech sectors like semiconductor, wireless, storage, industrial, defense aerospace, and automotive with its testing and automation solutions.
Companies valued at $10 billion or more are generally labeled as “large-cap” stocks, and Teradyne fits this criterion perfectly. The company stands as a dominant force in semiconductor test and a rising contender in AI-enhanced robotics. Its technology leadership, market share, innovation focus, and financial stability underscore a strong strategic position.
However, shares of TER touched its 52-week high of $163.21 on July 16, 2024, and have dwindled 47% from the peak. Shares of TER have dropped 4.2% over the past three months, lagging behind the First Trust Nasdaq Semiconductor ETF’s (FTXL) 10.4% returns over the same time frame.
TER has fallen 31.4% on a YTD basis, trailing FTXL’s 7.9% decline. In addition, shares of Teradyne have dipped nearly 40.3% over the past 52 weeks, compared to FTXL’s 11.6% drop over the same time frame.
The stock has been trading below its 200-day moving average since late January but has edged above its 50-day moving average since early June.
Teradyne delivered Q1 results on Apr. 28, and its stock slipped 2.5% in the following trading session. Revenue rose 14.3% year over year to $685.7 million, driven by solid gains in Semiconductor Test, especially SoC for mobile, coming slightly above the consensus estimate of $683.9 million. Adjusted EPS surged 47.1% from the prior-year quarter to $0.75, beating analyst expectations by nearly 23%.
Meanwhile, its top rival, ACM Research, Inc. (ACMR), has outpaced TER. ACMR shares have soared 66.9% on a YTD basis and 6.4% in the last 52 weeks.
Despite TER’s underperformance over the past year, analysts are moderately optimistic about its prospects. TER has a consensus rating of “Moderate Buy” from the 15 analysts covering the stock. Its mean price target of $96.86 implies an upside potential of 12.1% from the prevailing price levels.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com
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