TER
Teradyne, Inc.$325.83
Sell
Target $176.17
Report: Mar 07, 2026Technology • Semiconductors • Mature CompounderSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$325.83-45.9%
Rec: SellConviction: High
Entry Target
N/A
N/A
Fair Value
$176.17
(46% below current)
Stop Loss
N/A
N/A
Position Size
None
Time Horizon
N/A
Key Metrics
Live Snapshot
Market Data
52 Week High$344.92
52 Week Low$65.77
Avg. 3 Month Volume3.42M
Efficiency
LTM Gross Margin58.2%
LTM EBITDA Margin24.1%
LTM EBIT Margin20.1%
LTM Operating Margin20.4%
LTM ROA14.2%
LTM ROE19.9%
LTM ROIC27.4%
LTM ROCE21.0%
Capital Structure
Market Cap (MM)$46.4B
Enterprise Value (MM)$46.4B
Shares Outstanding156.41M
Total Debt (MM)$283.24M
Cash & Equivalents (MM)$293.75M
LTM Net Debt (MM)$-10.51M
LTM Net Debt/EBITDA-0.0x
Growth
TTM Rev. Growth13.1%
Last 3-Yr Rev. CAGR0.4%
Last 3-Yr EBITDA CAGR-7.0%
Last 3-Yr EPS CAGR-8.3%
Valuation
Street Target Price$277.58
LTM EV/Revenue14.5x
LTM EV/Gross Profit25.0x
LTM EV/EBIT72.5x
LTM EV/EBITDA60.4x
LTM P/E83.8x
LTM EV/FCF103.0x
LTM P/FCF103.0x
LTM P/TB12.9x
LTM P/B16.6x
Dividend Yield0.2%
Payout Ratio14.1%
Executive SummarySituation: Current price is $325.83 versus fair value $176.17 (-45.9% expected return), and valuation confidence is stable. Debate: Bull case depends on Normalization of AI Demand: A shift from the current 'build-at-any-cost' phase to a more disciplined capital spending environment among GPU and HBM manufacturers would likely lead to a re-rating of Teradyne's elevated multiple. Bear case centers on Moat Erosion in AI Compute: The biggest threat is a permanent impairment of pricing power if Advantest or a new entrant captures significant share in the merchant GPU testing market. Conclusion: Recommendation is Sell with no position, pending a materially better risk/reward setup.
Bull Case
Teradyne is the primary beneficiary of the AI infrastructure build-out, with HBM3E and HBM4 testing demand providing multi-year growth visibility. The company's duopoly position and high switching costs ensure pricing power and a 27.4% ROIC that remains well above the cost of capital.
Bear Case
The stock is priced for perfection at 92x P/E, while revenue growth of 13.1% is modest compared to other AI infrastructure peers. Margin compression and negative M&A effectiveness suggest that the company is struggling to translate top-line AI growth into per-share value accretion.
Key Catalysts
Mid-Term (6-18 months)Impact: High
Normalization of AI Demand: A shift from the current 'build-at-any-cost' phase to a more disciplined capital spending environment among GPU...
Mid-Term (6-18 months)Impact: Moderate
Robotics Breakeven: Achieving profitability in the Robotics segment (currently 10% of revenue) would validate the company's diversification...
Long-Term (18+ months)Impact: Moderate
Teradyne is currently at a sentiment peak following a 44% YoY revenue surge in Q4 2025, making it a critical moment to assess whether the va...
Primary Risks
Concern: High
Moat Erosion in AI Compute: The biggest threat is a permanent impairment of pricing power if Advantest or a new entrant captures significant...
Concern: Medium
Geopolitical and Export Controls: With 14% of revenue from mainland China and 36% from Taiwan, Teradyne is highly exposed to trade restricti...
Concern: Medium
Stewardship is adequate but lacks strong alignment. While the board is experienced-featuring former CFOs from Micron and Avago-insider owner...
Recent Activity
2026-02-11Analyst Target
+5.43%Firm: Morgan Stanley Analyst: Shane Brett Price Target: $306.00 Price When Posted: $318.09 Implied Downside: -3.8%
2026-02-03SEC Filing (8-K)
+13.41%Teradyne reports Q4 2025 revenue of $1.083B, up 44% YoY, above high-end of guidance
2025-12-02Analyst Target
+5.74%Firm: Stifel Nicolaus Price Target: $225.00 Price When Posted: $179.63 Implied Upside: +25.3%
2025-10-29SEC Filing (8-K)
+20.47%Michelle Turner appointed as Teradyne's new CFO, Sanjay Mehta transitioning to executive advisor
2025-10-07Analyst Target
-5.23%Firm: Northland Securities Analyst: Gus Richard Price Target: $161.00 Price When Posted: $141.17 Implied Upside: +14.0%
Valuation Table
9.8/10Decision Grade
Scenario Range
$146
Bear
$213
Base
$239
Bull
$326