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Teradyne (TER) to Post Q4 Earnings: What's in the Offing?

Zacks Equity Research
·4-min read

Teradyne TER is scheduled to report fourth-quarter 2021 results on Jan 26.

For the fourth quarter, the company expects revenues between $820 million and $900 million. The Zacks Consensus Estimate for sales is pegged at $867.4 million, indicating an improvement of 14.3% from the year-ago reported value.

Teradyne anticipates non-GAAP earnings between $1.14 and $1.40 per share for fourth-quarter 2021. The consensus mark for earnings per share is pegged at $1.29, indicating a 17.3% rise from the prior-year reported figure.

The company surpassed the Zacks Consensus Estimate in all the trailing four quarters, the earnings surprise being 9.32%, on average.

Teradyne, Inc. Price and EPS Surprise

Teradyne, Inc. Price and EPS Surprise
Teradyne, Inc. Price and EPS Surprise

Teradyne, Inc. price-eps-surprise | Teradyne, Inc. Quote

Factors to Note

In the fourth quarter, the company is expected to have continued gaining from a strong demand environment across its Industrial/Automotive Test, Storage Test, and Industrial Automation businesses.

Teradyne’s Semiconductor Test revenues are likely to have benefited from persistent growth in 5G infrastructure, strengthening of mobility, strong networking and growing memory test spending in the to-be-reported quarter.

The growing momentum in the Memory test business, owing to the strong demand for flash and DRAM, is expected to have been another major positive.

Improving global manufacturing conditions and the proliferation of new technically advanced products are expected to have contributed well to the company’s Industrial Automation business in the fourth quarter.

Strengthening system-on-a-chip (SOC) test shipments, owing to the increased demand for mobility-related test capacity, are expected to have driven top-line growth of Teradyne in the quarter under review.

Strengthening momentum across the UltraFLEXplus platform is expected to have driven Teradyne’s growth in the SOC Test market.

The increasing complexity of processors and technologies, popularity of its products, growing demand for millimeter-wave test capabilities, and persistent design wins are expected to have driven its fourth-quarter performance.

The solid demand for ultra-wideband is likely to have benefited the company’s LitePoint business in the quarter to be reported.

However, uncertainties associated with the ongoing coronavirus pandemic are expected to have been concerning. Moreover, shipment delays in the Industrial Automation business, owing to a challenging supply environment, are expected to have acted as headwinds.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for TE Connectivity this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

TE Connectivity has an Earnings ESP of 0.00% and a Zacks Rank #2.

Stocks to Consider

Here are some stocks that you may also consider, as our model shows that these have the right combination of elements to beat on earnings this season.

Alphabet GOOGL has an Earnings ESP of +7.33% and a Zacks Rank #3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Alphabet is scheduled to release the fourth-quarter 2021 results on Feb 1. The Zacks Consensus Estimate for GOOGL’s earnings is pegged at $26.69 per share, which suggests an increase of 19.69% from the prior-year reported figure.

Endava DAVA has an Earnings ESP of +1.70% and a Zacks Rank of 2 at present.

Endava is scheduled to release the second-quarter fiscal 2022 results on Feb 16. The Zacks Consensus Estimate for DAVA’s earnings is pegged at 59 cents per share, suggesting an increase of 55.26% from the prior-year reported figure.

Monolithic Power Systems MPWR has an Earnings ESP of +2.83% and a Zacks Rank #2 at present.

Monolithic Power Systems is set to report the fourth-quarter 2021 results on Feb 10. The Zacks Consensus Estimate for MPWR’s earnings is pegged at $1.87 per share, which suggests an increase of 42.75% from the prior-year reported figure.


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