Why Teradyne (TER) Dipped More Than Broader Market Today

Company Performance - Teradyne's stock closed at $88.87, reflecting a -1.44% change from the previous session, underperforming compared to the S&P 500's daily loss of 1.07% [1] - Over the past month, Teradyne's shares have decreased by 20.38%, which is worse than the Computer and Technology sector's loss of 11.12% and the S&P 500's loss of 7.03% [2] - The upcoming earnings disclosure is projected to show earnings of$ 0.61 per share, indicating a year-over-year growth of 19.61%, with revenue expected to be $683.57 million, a 13.96% increase from the same quarter last year [3] Analyst Estimates - For the full year, earnings are projected at$ 3.43 per share and revenue at $3.06 billion, reflecting changes of +6.52% and +8.36% respectively from the previous year [4] - Recent changes in analyst estimates for Teradyne suggest a shifting business landscape, with positive revisions indicating a favorable business outlook [4] Valuation Metrics - Teradyne is currently trading at a Forward P/E ratio of 26.31, which is higher than the industry average of 19.46, suggesting a premium valuation [7] - The company has a PEG ratio of 3.93, significantly above the industry average PEG ratio of 1.45, indicating that Teradyne's stock may be overvalued relative to its expected earnings growth [8] Industry Context - The Electronics - Miscellaneous Products industry, which includes Teradyne, is ranked 149 out of over 250 industries, placing it in the bottom 41% of the Zacks Industry Rank [9] - Research indicates that industries in the top 50% of the Zacks Rank outperform those in the bottom half by a factor of 2 to 1 [9]