For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.
Another factor that can influence investors is FOMO, or the fear of missing out, especially with tech giants and popular consumer-facing stocks.
What if you'd invested in Teradyne (TER) ten years ago? It may not have been easy to hold on to TER for all that time, but if you did, how much would your investment be worth today?
With that in mind, let's take a look at Teradyne's main business drivers.
Headquartered in North Reading, MA, Teradyne designs, develops, manufactures and sells automated test equipment and robotics products. Its automatic test systems are used to test semiconductors, wireless products, data storage and complex electronics systems in consumer electronics, wireless, automotive, industrial, computing, communications, and aerospace and defense industries.
Robotics products include collaborative robotic arms and autonomous mobile robots (“AMRs”) that are used by global manufacturing, logistics and industrial customers.
Teradyne's semiconductor test products are used both for wafer level and device package testing of semiconductor devices. Its product portfolio comprises the FLEX Test platform, J750 test system, Magnum test platform and ETS platform, each tailored for specific semiconductor testing needs.
The company’s system Test segment is comprised of three business units: Storage Test, Defense/Aerospace and Production Board Test. Wireless Test business operates under the LitePoint brand name and provides test solutions utilized in the development and manufacturing of wireless devices and modules.
The Robotics segment comprises two business units: Universal Robots and Mobile Industrial Robots (MiR).
Universal Robots offers a variety of collaborative robot models, including the UR3, UR5, UR10, UR16 and UR20, each with different weight carrying capacity and arm reach. MiR offers four collaborative autonomous mobile robot models, MiR100, MiR250, MiR600 and MiR1350, each with a different payload carrying capacity.
Teradyne reports revenues primarily under four segments: Semiconductor Test, System Test, Robotics, and Wireless Test. In 2023, the company reported revenues of $2.68 billion.
Teradyne competes globally with key rivals like Advantest, Cohu, Keysight, Test Research, SPEA, Rohde & Schwarz, Anritsu, KUKA, ABB, FANUC, Yaskawa, Techman, Doosan, AUBO, Omron, Fetch, OTTO Motors, Vecna, Seegrid and Balyo.
Anyone can invest, but building a successful investment portfolio requires research, patience, and a little bit of risk. So, if you had invested in Teradyne ten years ago, you're likely feeling pretty good about your investment today.
According to our calculations, a $1000 investment made in January 2015 would be worth $6,424.37, or a 542.44% gain, as of January 3, 2025. Investors should keep in mind that this return excludes dividends but includes price appreciation.
In comparison, the S&P 500 gained 185.13% and the price of gold went up 115.13% over the same time frame.
Looking ahead, analysts are expecting more upside for TER.
Teradyne is benefiting from its robust and diversified portfolio. Improving memory and compute outlook driven by the positive impact of AI-driven applications on test demand is expected to drive top-line growth despite weakness in mobile, legacy auto and industrial end-markets. These markets are expected to recover in 2025. Compute total addressable market (TAM) is now expected to be $1.6 billion, while SOC TAM remains unchanged between $3.6 billion and $4.2 billion. Memory TAM is estimated between $1.2 billion and $1.3 billion driven by strong demand for HBM. Teradyne estimates TAM for auto, mobile and industrial end-markets of $500 million, $800 million and $300 million, respectively. Robotics are expected to grow in the low end of its 10-20% range. Teradyne expects 2024 revenues to grow low single digits over 2023.
Over the past four weeks, shares have rallied 11.29%, and there have been 1 higher earnings estimate revisions in the past two months for fiscal 2024 compared to none lower. The consensus estimate has moved up as well.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
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