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Teradyne

TER
69
Semiconductors · Technology
Also trades as: 0LEF.L GBP 3.32 (-1.38%)
Price
$325.00
-18.21 (-5.31%)
Market Cap
$50.81B
Exchange
NASDAQ
Winston Score
69
Winston is curious
A decent business — some strong pillars, some weaker.
Data as of Oct 18, 2026 · filings through Jun 28, 2026

§How the score breaks down

Quality
Exceptional
28/30
Growth
Exceptional
17/20
Cash Flow
Exceptional
9/10
Stability
Exceptional
10/10
Valuation
Weak
2/10
Ownership
Weak
1/15
Dividends
Mixed
2/5

69 of 100 counted points = Winston Score 69.

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Share count falling — buybacks

−14.1% over 4y

The company has reduced its share count over this period, returning value to shareholders through buybacks.

Diluted shares outstanding: 183.6M (2021) → 157.7M (2025)

§Winston Score History

The full picture

Teradyne makes machines that test semiconductors and electronics before they ship to customers. Its main products are automated test equipment (ATE) used by chipmakers, smartphone manufacturers, and defense contractors to check that chips and circuit boards work correctly. Teradyne is one of the largest semiconductor test equipment companies in the world, and it also owns Universal Robots, a maker of small collaborative robots used in factories.

Teradyne earns money by selling testing hardware and software, with additional revenue from service contracts and support. It operates globally, with a large share of sales coming from Asia, where most chip manufacturing happens. The company's competitive edge comes from deep technical expertise and long customer relationships that are hard to replace once its machines are built into a production line. The biggest growth driver is rising chip complexity — more advanced semiconductors require more testing — but the business is cyclical, meaning revenue can drop sharply when chipmakers cut spending.

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Growth Profile

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

>+1,000% YoY

YoY Growth Rate

Revenue accelerating

EPS Growth

+387.8% YoY

YoY Growth Rate

EPS growth accelerating

R&D Spend

$505M/ year

↑ Rising (+9% vs prior year)

15.8% of revenue

In line with sector average (15%)

Investing heavily in future products and technology

Insider Activity

0.2%ownership

→ Flat

Insider ownership roughly steady over the past year

Cash Position

Cash flow positive

$354.8B cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Revenue accelerating

Teradyne grew revenue 400362% year-over-year and the growth rate is speeding up. That's the kind of momentum growth investors look for — the question is whether margins can follow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

Each metric is explained in plain language so you know exactly what you're looking at. Start your free trial now.

Quality

Profit per sale
Gross Margin
60.3%
Premium pricing power — 60.3% gross margin
Profit after running costs
Operating Margin
34.9%
Excellent — 34.9% operating margin
Return on the money invested
ROCE
25.8%
Exceptional — 25.8% return on capital

ROIC above 25%. Every dollar invested in the business earns more than 25 cents back per year.

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Growth

Sales growth
Sales YoY
>+1,000%
Fast-growing sales (>+1,000% YoY)
Profit growth
EPS YoY
+153.6%
Earnings growing fast (+153.6% YoY)

Earnings growing 25%+ a year. The compounder zone.

How steady the profit is
EPS Consistency
6/8 quarters
Earnings grew in most of the last 8 quarters

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Cash Flow

Profit that turns into cash
Cash Conversion
125%
Turns 125% of profit into real cash
Spare cash per sale
FCF Margin
14.5%
Converts sales into free cash efficiently (14.5%)

FCF margin between 10% and 20%. Every $100 in sales becomes $10 to $20 in real cash.

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Stability

What it owes vs what it owns
Debt / Equity
0.03
Conservative — low debt load (0.03)
Covers its interest
Interest Cover
598.05x
Comfortably covers interest (598.0x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

Price vs profit
P/E Ratio (TTM)
44.3x
Pricey — P/E 44.3

P/E over 35. The market is pricing in heavy, sustained growth.

Cheaper or dearer next year
P/E vs Forward
-4.6
SLOWING
Earnings expected to fall — forward P/E higher than today

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Dividends

Dividend
Dividend Yield
0.12%
Small dividend — 0.12% yield

Modest yield. The bulk of any return needs to come from price appreciation.

Dividend record
Dividend Growth
+6.3%
Dividend growing modestly (6.3% YoY)
Payout Ratio
7%
no trend
Pays out a modest share of profit and keeps the rest to reinvest. Room to keep paying through a weak year.

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