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Teradyne (TER) Stock Declines While Market Improves: Some Information for Investors

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In the latest market close, Teradyne (TER - Free Report) reached $86.64, with a -0.5% movement compared to the previous day. This change lagged the S&P 500's 0.49% gain on the day. At the same time, the Dow lost 0.2%, and the tech-heavy Nasdaq gained 1.22%.

Shares of the maker of wireless products, data storage and equipment to test semiconductors have depreciated by 22.76% over the course of the past month, underperforming the Computer and Technology sector's loss of 12.07% and the S&P 500's loss of 8.15%.

Analysts and investors alike will be keeping a close eye on the performance of Teradyne in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $0.61, marking a 19.61% rise compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $683.57 million, reflecting a 13.96% rise from the equivalent quarter last year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $3.88 per share and revenue of $3.21 billion. These totals would mark changes of +20.5% and +13.77%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Teradyne. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, there's been a 0.8% fall in the Zacks Consensus EPS estimate. Teradyne currently has a Zacks Rank of #3 (Hold).

Looking at valuation, Teradyne is presently trading at a Forward P/E ratio of 22.43. This indicates a premium in contrast to its industry's Forward P/E of 19.14.

We can also see that TER currently has a PEG ratio of 2.08. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. By the end of yesterday's trading, the Electronics - Miscellaneous Products industry had an average PEG ratio of 1.34.

The Electronics - Miscellaneous Products industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 86, which puts it in the top 35% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.


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