# Teradyne (TER.US)

Canonical: https://gigainvestors.com/s/TER

Analysis as of: 2026-10-16T07:32:19.650Z. Financial observations: FY1996–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: $343.21 per share; close as of 2026-10-15.

Estimated value: low $66.89 per share, central $92.07 per share, high $107.70 per share. Buy at or below the central value $92.07 per share. Valuation as of 2026-10-16T07:32:19.650Z; scenarios are not confidence intervals.

Expected annual return: 4.9% at the stated quote. About 4.9% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: pass

- 3 revenue declines in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 3

- Years with a net loss: 0

- Operating margin variation: 0.17×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.25×

- FY2018: 0.23×

- FY2019: 0.24×

- FY2020: 0.30×

- FY2021: 0.32×

- FY2022: 0.26×

- FY2023: 0.19×

- FY2024: 0.21×

- FY2025: 0.20×

- LTM to Jun 2026: 0.30×

### moat: pass

- ROIC, median of available years: 57.3%

- ROIC, second-lowest year: 24.7%

- Typical minus recent gross margin: -0.1 pp

- Typical gross margin (annual median): 58.2%

- Recent gross margin (lower of latest and 3-year median): 58.2%

- Years with nonpositive capital: 0

- Capital spending / revenue: 5.7%

- ROIC including acquisitions, ten-year median: 33.7%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: -5.1%

- FY2017: 62.1%

- FY2018: >100%

- FY2019: 74.8%

- FY2020: 97.2%

- FY2021: >100%

- FY2022: 52.4%

- FY2023: 31.9%

- FY2024: 27.3%

- FY2025: 24.7%

### economics: fail

- working capital as a share of revenue rose more than 10pp and ends positive

- Owner earnings / net income, 5-yr: 0.94×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $3.1B

- Net income, five-year total: $3.3B

- Return on incremental invested capital: 39.8%

- Working capital / revenue, annual change: 2.1 pp

- Working capital / revenue, change between three-year averages: 13.5 pp

- Working capital / revenue, final three-year average: 27.9%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.00×

- FY2022: 0.93×

- FY2023: 0.89×

- FY2024: 0.90×

- FY2025: 0.94×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- potential debt-funded buybacks (informational)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: 62.1% vs 27.3%

- Per-share earnings: 0.97 to 3.32 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: -2.9%

- Ordinary dilution, 5-year annual growth: -2.7%

- Market cap gain: $25B

- Cumulative retained earnings: $514M

- Diluted shares, 10-year annual growth: -2.9%

- Diluted shares, 5-year annual growth: -2.7%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 16.7%

- Per-share value change: $2.35

- Per-share value, starting three-year median: $0.97

- Per-share value, ending three-year median: $3.32

- Buybacks concentrated in cheaper years (correlation): 0.47

- Average buyback yield: 3.9%

- Buyback history: 10 years

- Debt-funded buybacks: Yes

- Acquisition spending: $392M

- Cumulative net income, 10 years: $5.2B

- ROIC, first three-year median: 62.1%

- ROIC, last three-year median: 27.3%

Chart: Earnings per share; fiscal year observations.

- FY2016: -$0.21

- FY2017: $1.28

- FY2018: $2.35

- FY2019: $2.60

- FY2020: $4.28

- FY2021: $5.53

- FY2022: $4.22

- FY2023: $2.73

- FY2024: $3.32

- FY2025: $3.47

### accounting: pass

- Sloan accruals: -2.9%

- Receivables to sales index (DSRI): 1.45×

- Restructuring years, last five: 2

- Stock compensation / operating cash flow: 9.5%

- Earnings backed by cash: Yes

- Operating cash / earnings: 1.22×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.20×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -17.7%

- FY2017: -11.9%

- FY2018: -0.9%

- FY2019: -4.0%

- FY2020: -2.3%

- FY2021: -2.2%

- FY2022: 3.9%

- FY2023: -3.9%

- FY2024: -3.5%

- FY2025: -2.9%

## Holders

- [Stephen Mandel](https://gigainvestors.com/LPC): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Lee Ainslie](https://gigainvestors.com/mc): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Down 29% since Jun 2026 · "Teradyne Soars as AI Demand Is Almost 70% of Total Sales" (finance.yahoo.com, Jun 2026) · sales +39.9%

Story as of 2026-10-16T09:59:40.706Z; price observation 2026-10-15.

Price needs cash profits to grow 22.9% a year for ten years

- 2025-07-29: Teradyne beats quarterly revenue estimates on robust chip-testing demand ([finance.yahoo.com](https://finance.yahoo.com/news/teradyne-beats-quarterly-revenue-estimates-213414713.html))

- 2025-10-28: Teradyne Sees Big Fourth-Quarter Revenue Jump on AI-Related Demand ([finance.yahoo.com](https://finance.yahoo.com/m/16fed233-e81a-3582-9e51-c48b678e20a7/teradyne-sees-big.html))

- 2026-01-27: How Teradyne’s (TER) Dividend and AI Test Demand Surge Could Reshape Its Investment Profile ([finance.yahoo.com](https://finance.yahoo.com/news/teradyne-ter-dividend-ai-test-221053788.html))

- 2026-02-25: TER Rides on Strong AI Infrastructure Demand: A Sign for More Upside? ([finance.yahoo.com](https://finance.yahoo.com/news/ter-rides-strong-ai-infrastructure-174600064.html))

- 2026-04-28: Teradyne forecasts sequential decline in quarterly revenue and profit, shares fall ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/teradyne-forecasts-sequential-decline-quarterly-215350827.html))

- 2026-06-29: Teradyne Soars as AI Demand Is Almost 70% of Total Sales ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/teradyne-soars-ai-demand-almost-213335855.html))

### Sales · FY2025–2026

sales +39.9%; source https://www.sec.gov/Archives/edgar/data/97210/000119312526059002/ter-20251231.htm; observed 2026-02-19.

- FY2017: $2.1B 

- FY2018: $2.1B 

- FY2019: $2.3B 

- FY2020: $3.1B 

- FY2021: $3.7B 

- FY2022: $3.2B 

- FY2023: $2.7B 

- FY2024: $2.8B 

- FY2025: $3.2B 

- FY2026: $4.5B 

### Gross margin · FY2025

gross margin 58.2%; source https://www.sec.gov/Archives/edgar/data/97210/000119312526059002/ter-20251231.htm; observed 2026-02-19.

- FY2016: 54.7% 

- FY2017: 57.2% 

- FY2018: 58.1% 

- FY2019: 58.4% 

- FY2020: 57.2% 

- FY2021: 59.6% 

- FY2022: 59.2% 

- FY2023: 57.4% 

- FY2024: 58.5% 

- FY2025: 58.2% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in semiconductor equipment & materials; annual sales are USD 3.2 billion.

- Source: https://www.sec.gov/Archives/edgar/data/97210/000119312526059002/ter-20251231.htm (filed 2026-02-19); FY2025: revenue 3190024000; grossProfit 1857345000; margin = grossProfit / revenue.

### Why customers stay

Margins ranged from 57.4% to 58.5% during 2023–25; it earns 57.3% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2023: grossProfit / revenue = 57.4%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2024: grossProfit / revenue = 58.5%.

- Source: https://www.sec.gov/Archives/edgar/data/97210/000119312526059002/ter-20251231.htm (filed 2026-02-19); FY2025: grossProfit / revenue = 58.2%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); 10-year return on capital observations [[2016,-0.05146779480048668],[2017,0.621275598946204],[2018,1.0403518681685067],[2019,0.7477024070536935],[2020,0.9716182345285548],[2021,1.0381812652136408],[2022,0.5243731218225715],[2023,0.3193284404587001],[2024,0.27316898618851837],[2025,0.24725731654125388]]; median 0.5728243603843877. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Spends 12.4% of cash earnings on expansion; earns 39.8% on new investment.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2017: growth capex 0; upkeep 105375000; owner earnings 260392000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2018: growth capex 0; upkeep 114379000; owner earnings 450624000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2019: growth capex 13987000; upkeep 120655000; owner earnings 467468000. Growth capex / owner earnings = 0.02992076462987841.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2020: growth capex 58234000; upkeep 126743000; owner earnings 784147000. Growth capex / owner earnings = 0.07426413669885876.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2021: growth capex 6987000; upkeep 125485000; owner earnings 1014589000. Growth capex / owner earnings = 0.006886532379121004.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2022: growth capex 0; upkeep 163249000; owner earnings 662927000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2023: growth capex 0; upkeep 159642000; owner earnings 399812000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); FY2024: growth capex 23610158.382829607; upkeep 174484841.6171704; owner earnings 487628158.3828296. Growth capex / owner earnings = 0.048418365463410384.

- Source: https://www.sec.gov/Archives/edgar/data/97210/000119312526059002/ter-20251231.htm (filed 2026-02-19); FY2025: growth capex 65051605.470356196; upkeep 158957394.5296438; owner earnings 523070605.4703562. Growth capex / owner earnings = 0.12436486545035427.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); Incremental return on capital 0.398251847052407, from the economics test's unchanged annual inputs.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); Dividend observations: [[2016,48619000],[2017,55447000],[2018,67322000],[2019,61305000],[2020,66482000],[2021,65977000],[2022,69711000],[2023,67878000],[2024,76423000],[2025,76313000]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://www.sec.gov/Archives/edgar/data/97210/000119312526059002/ter-20251231.htm (filed 2026-02-19); FY2025: cash repurchases 702095000 USD.

### Are managers owners

Insiders own 0.2% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); TER.US SharesStats.PercentInsiders = 0.198 percentage points; cache date 2026-10-16.

### What could break it

"The market for our products is concentrated" (SEC filing, Feb 2026)

- Source: https://www.sec.gov/Archives/edgar/data/97210/000119312526059002/ter-20251231.htm (filed 2026-02-19); The market for our products is concentrated

### What the price says

The price assumes cash profits grow 22.9% yearly over ten years; actual growth was 10.5%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-19); Ten-year compound average after fade. Initial solved rate 0.32117093384756934. Price 343.21; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share 1.206501000839111 → FY2025 3.2749429026625276. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $23.29 per share

- 2016-11: $24.38 per share

- 2016-12: $25.40 per share

- 2017-01: $28.38 per share

- 2017-02: $28.44 per share

- 2017-03: $31.10 per share

- 2017-04: $35.27 per share

- 2017-05: $35.55 per share

- 2017-06: $30.03 per share

- 2017-07: $34.59 per share

- 2017-08: $35.61 per share

- 2017-09: $37.29 per share

- 2017-10: $42.89 per share

- 2017-11: $40.47 per share

- 2017-12: $41.87 per share

- 2018-01: $45.84 per share

- 2018-02: $45.40 per share

- 2018-03: $45.71 per share

- 2018-04: $32.55 per share

- 2018-05: $37.91 per share

- 2018-06: $38.07 per share

- 2018-07: $43.25 per share

- 2018-08: $41.19 per share

- 2018-09: $36.98 per share

- 2018-10: $34.45 per share

- 2018-11: $35.69 per share

- 2018-12: $31.38 per share

- 2019-01: $35.99 per share

- 2019-02: $40.83 per share

- 2019-03: $39.84 per share

- 2019-04: $49.00 per share

- 2019-05: $42.14 per share

- 2019-06: $47.91 per share

- 2019-07: $55.73 per share

- 2019-08: $52.97 per share

- 2019-09: $57.91 per share

- 2019-10: $61.22 per share

- 2019-11: $62.59 per share

- 2019-12: $68.19 per share

- 2020-01: $65.99 per share

- 2020-02: $58.76 per share

- 2020-03: $54.17 per share

- 2020-04: $62.54 per share

- 2020-05: $67.02 per share

- 2020-06: $84.51 per share

- 2020-07: $88.96 per share

- 2020-08: $84.97 per share

- 2020-09: $79.46 per share

- 2020-10: $87.85 per share

- 2020-11: $110.34 per share

- 2020-12: $119.89 per share

- 2021-01: $113.48 per share

- 2021-02: $128.61 per share

- 2021-03: $121.68 per share

- 2021-04: $125.08 per share

- 2021-05: $132.35 per share

- 2021-06: $133.96 per share

- 2021-07: $127.00 per share

- 2021-08: $121.44 per share

- 2021-09: $109.17 per share

- 2021-10: $138.24 per share

- 2021-11: $152.87 per share

- 2021-12: $163.53 per share

- 2022-01: $117.43 per share

- 2022-02: $117.92 per share

- 2022-03: $118.23 per share

- 2022-04: $105.46 per share

- 2022-05: $109.26 per share

- 2022-06: $89.55 per share

- 2022-07: $100.89 per share

- 2022-08: $84.64 per share

- 2022-09: $75.15 per share

- 2022-10: $81.35 per share

- 2022-11: $93.45 per share

- 2022-12: $87.35 per share

- 2023-01: $101.70 per share

- 2023-02: $101.14 per share

- 2023-03: $107.51 per share

- 2023-04: $91.38 per share

- 2023-05: $100.19 per share

- 2023-06: $111.33 per share

- 2023-07: $112.94 per share

- 2023-08: $107.87 per share

- 2023-09: $100.46 per share

- 2023-10: $83.27 per share

- 2023-11: $92.23 per share

- 2023-12: $108.52 per share

- 2024-01: $96.59 per share

- 2024-02: $103.59 per share

- 2024-03: $112.83 per share

- 2024-04: $116.32 per share

- 2024-05: $140.94 per share

- 2024-06: $148.29 per share

- 2024-07: $131.16 per share

- 2024-08: $136.73 per share

- 2024-09: $133.93 per share

- 2024-10: $106.21 per share

- 2024-11: $110.00 per share

- 2024-12: $125.92 per share

- 2025-01: $115.79 per share

- 2025-02: $109.86 per share

- 2025-03: $82.60 per share

- 2025-04: $74.21 per share

- 2025-05: $78.60 per share

- 2025-06: $89.92 per share

- 2025-07: $107.43 per share

- 2025-08: $118.24 per share

- 2025-09: $137.64 per share

- 2025-10: $181.76 per share

- 2025-11: $181.89 per share

- 2025-12: $193.56 per share

- 2026-01: $241.05 per share

- 2026-02: $320.03 per share

- 2026-03: $296.46 per share

- 2026-04: $343.47 per share

- 2026-05: $374.31 per share

- 2026-06: $483.84 per share

- 2026-07: $367.69 per share

- 2026-08: $349.83 per share

- 2026-09: $400.91 per share

- 2026-10: $380.29 per share

## Annual estimated value (USD per share)

- FY2016: low $19.49 per share, central $21.39 per share, high $23.93 per share

- FY2017: low $22.72 per share, central $24.67 per share, high $27.26 per share

- FY2018: low $20.11 per share, central $22.11 per share, high $24.78 per share

- FY2019: low $29.85 per share, central $37.51 per share, high $43.06 per share

- FY2020: low $50.95 per share, central $64.43 per share, high $74.11 per share

- FY2021: low $65.84 per share, central $91.04 per share, high $105.72 per share

- FY2022: low $58.12 per share, central $79.50 per share, high $92.46 per share

- FY2023: low $42.07 per share, central $47.23 per share, high $54.10 per share

- FY2024: low $42.98 per share, central $48.45 per share, high $55.73 per share

- FY2025: low $47.22 per share, central $64.83 per share, high $75.77 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

Prior published observations retained from 2026-10-15T06:38:05.040Z where newer inputs omit a numeric field or fiscal period.

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/97210/000119312526059002/ter-20251231.htm); period 2025-12-31, filed 2026-02-19.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.