One-glance verdict
Overvalued
$44.86 our estimate vs market $312.14
Wall Street consensus: $429.88 (858.2% higher than our fair-value estimate)
596% above our estimate, beyond the bull case
Fundamentals snapshot
Teradyne, Inc.
TER · NMS · Technology · Semiconductor Equipment & Materials
Current price
$312.14
52-week range
$89.18 - $487.91
Market cap
$48.86B
Balance sheet
Healthy
100.59x Strong cushion
Net cash $163.20M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 18.7% last year.
- Reward Returns 28.7% on equity, ahead of 60% of its peers.
- Risk Stock trades 50.3% above its 5-year average P/E.
- Risk Insider ownership is only 0.3% (peer median: 0.6%).
What this company does
Teradyne, Inc.
Teradyne builds the advanced automated equipment that tests semiconductor chips (the tiny brains in cars, phones, and computers) to make sure they work correctly. Most of its revenue comes from selling these testing systems to chipmakers, so its business grows as the world demands more and more electronic devices. The company also sells collaborative robots that work alongside people in factories and warehouses.
How the company got here
Teradyne was started in 1960 by two MIT graduates in a small space above a hot dog stand in Boston. Their first product was a machine to test electronic components called diodes, which were essential for the growing semiconductor industry. The company grew quickly by creating new and better ways to test electronics right on the factory floor. A major turning point came in 2015 when Teradyne bought Universal Robots, which marked a significant expansion from just testing electronics to also building robots for factories.
What it actually does
Imagine every tiny computer chip in your phone, car, or computer; Teradyne builds the incredibly complex and expensive machines that make sure those chips work perfectly before they ever get to you. These machines run tests to find any flaws in the chips, which is a critical step for electronics manufacturers. In addition to this testing equipment, the company also makes robotic arms and self-driving carts that help automate tasks in factories and warehouses. Essentially, Teradyne helps other companies build and verify their electronic products more efficiently and reliably.
Semiconductor Test
This is Teradyne's largest and original business, making up the vast majority of its sales. It creates automated test equipment (ATE) for semiconductor companies, the businesses that make computer chips. These customers, which include major chipmakers, use Teradyne's machines to test everything from simple chips in home appliances to the most complex processors for artificial intelligence. This testing is crucial because it ensures the chips are reliable and perform as expected, and chipmakers pay Teradyne for these highly advanced and precise systems.
Robotics
This part of the company, a smaller but important piece of the business, builds robots designed to work alongside people in factories and warehouses. It includes two main brands you might hear about: Universal Robots, which makes collaborative robotic arms (often called 'cobots'), and Mobile Industrial Robots (MiR), which makes autonomous mobile robots (AMRs) that are like smart, self-driving carts for moving materials. Companies in manufacturing and logistics buy these robots to automate repetitive or physically demanding tasks, which can increase their efficiency (how quickly they can make things) and improve worker safety.
Other
This smaller collection of businesses includes a few different types of testing. It covers equipment that tests fully assembled circuit boards, systems that test wireless devices like phones and tablets to make sure their Wi-Fi and Bluetooth work correctly, and equipment for testing data storage systems. Customers for these products are companies that make all kinds of electronics, from consumer gadgets to complex systems for the defense and aerospace industries. While not as large as the semiconductor business, it broadens Teradyne's reach across the entire electronics manufacturing process.
What management is betting on now
The company is heavily focused on the growth of artificial intelligence (AI), as the powerful chips that enable AI require more intense and complex testing. Management believes this increasing complexity will drive demand for its most advanced semiconductor test equipment. Teradyne is also investing in its robotics division, aiming to make its collaborative and mobile robots a bigger part of the company's future as more industries adopt automation. The strategy is to lead in their core testing market while building a second major business in the growing field of industrial automation.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q2
$171.22M
FY2024 Q3
$114.43M
FY2024 Q4
$225.17M
FY2025 Q1
$97.62M
FY2025 Q2
$131.68M
FY2025 Q3
$2.36M
FY2025 Q4
$218.75M
FY2026 Q1
$200.39M
Revenue
$1.28B
Net income
$398.91M
Diluted EPS
2.53
Operating cash flow
$265.12M
Free cash flow
$200.39M
Fetching…
Sources
Revenue
$1.08B
Net income
$257.22M
Diluted EPS
1.62
Operating cash flow
$281.64M
Free cash flow
$218.75M
Fetching…
Sources
Revenue
$769.21M
Net income
$119.56M
Diluted EPS
0.75
Operating cash flow
$49.05M
Free cash flow
$2.36M
Fetching…
Sources
Revenue
$651.80M
Net income
$78.37M
Diluted EPS
0.49
Operating cash flow
$182.09M
Free cash flow
$131.68M
Fetching…
Sources
Revenue
$685.68M
Net income
$98.90M
Diluted EPS
0.61
Operating cash flow
$161.64M
Free cash flow
$97.62M
Fetching…
Sources
Revenue
$752.88M
Net income
$146.25M
Diluted EPS
0.89
Operating cash flow
$282.56M
Free cash flow
$225.17M
Fetching…
Sources
Revenue
$737.30M
Net income
$145.65M
Diluted EPS
0.89
Operating cash flow
$166.27M
Free cash flow
$114.43M
Fetching…
Sources
Revenue
$729.88M
Net income
$186.27M
Diluted EPS
1.14
Operating cash flow
$216.07M
Free cash flow
$171.22M
Fetching…
Sources
Is it cheap or expensive?
Fair value $44.86 vs current price $312.14
Wall Street consensus is the average analyst price target: $429.88 (858.2% higher than our fair-value estimate).
Our most-likely fair value is $44.86 a share — about 85.6% below today's price of $312.14, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Healthy
Net cash $163.2M - more cash than debt. Interest coverage 100.6x.
Net debt
$-163.20M
Interest coverage
100.59x
Teradyne, Inc.'s profit covers its interest bill about 100.6 times over. which is stronger than most peers shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
TER
BASELINE
Teradyne, Inc.
Total debt $82.40M Interest coverage 100.59x This is the baseline the peer rows are being compared against.
Total debt $6.15B Interest coverage 16.59x -84% vs TER Carries about 6.1x less debt cushion than TER.
Total debt $31.89M Interest coverage 115.35x +15% vs TER Has roughly the same debt cushion as TER.
Total debt $4.29B Interest coverage 2.48x -98% vs TER Carries about 40.6x less debt cushion than TER.
Total debt $330.08M Interest coverage -29.03x -100% vs TER This peer has almost no interest-payment cushion compared with TER.
What you should know
The case for and against TER
3 Rewards
2 Risks
Rewards
-
Revenue grew 18.7% last year.
-
Returns 28.7% on equity, ahead of 60% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
-
Stock trades 50.3% above its 5-year average P/E.
-
Insider ownership is only 0.3% (peer median: 0.6%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
57.91x
Forward P/E
30.28x
P/B
15.54x
P/S
—
EV/EBITDA
44.98x
PEG ratio
1.32x
Profitability
How much profit each dollar creates
Gross margin
58.7%
Operating margin
37.6%
Net margin
22.6%
ROE
28.7%
ROA
15.8%
Health
Liquidity and balance-sheet strength
Debt / equity
0.03x
Current ratio
2.15x
Quick ratio
1.34x
Total debt
$82.40M
Total cash
$245.60M
Growth
How the business has been compounding
Revenue TTM
$3.79B
Revenue 5Y CAGR
-3.7%
EPS TTM
5.39
EPS 5Y CAGR
-6.3%
Cash flow
How much cash the business throws off
Operating CF TTM
$777.90M
Free CF TTM
$450.41M
FCF margin
11.9%
Dividend
Shareholder payout
Yield
0.2%
Payout ratio
9.1%
Last ex-div date
2026-05-21