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Teradyne (TER) to Report Q3 Earnings: What's in the Cards?

Zacks Equity Research
·4-min read

Teradyne TER is scheduled to report third-quarter 2022 results on Oct 25.

For the third quarter, TER expects revenues between $760 million and $840 million. The Zacks Consensus Estimate for sales is pegged at $801.4 million, indicating a decline of 15.7% from the year-ago quarter’s reported value.

Teradyneanticipates non-GAAP earnings between 90 cents and $1.16 per share. The consensus mark for earnings is pegged at $1.04 per share, indicating a 34.6% fall from the previous-year quarter’s reported figure. Also, the consensus mark has moved 0.97% north in the past 30 days.

TER’s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average being 8.66%.

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

Key Factors to Note

Teradyne is witnessing strong momentum in the automotive and industrial end markets on the back of its robust Eagle platform. This is likely to have benefited Teradyne’s third-quarter performance.

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Increasing design wins for the Semiconductor Test platforms owing to their growing usage in research and development applications are expected to have aided TER’s financial performance in the quarter to be reported.

Growing demand for ultra-wideband test products might have driven Teradyne’s LitePoint business.

Teradyne’s continuous efforts to add OEM partners to serve more customers through partners’ distribution network and gain momentum in new market verticals are likely to have supported its quarterly performance.

TER is witnessing steady demand for FLASH and DRAM devices. This is likely to have augmented the Memory test revenues in the quarter under review. We expect Memory revenues to see a 4.1% rise in the third quarter from the prior-year quarter’s reported figure.

Continuous investments in wafer-fab equipment and robust 3-nanometer technology, and the growing opportunities for human-scale automation projects are expected to have remained tailwinds.

However, Teradyne is enduring weakening demand in mobility & compute semiconductor and wireless test markets. Our estimate suggests that the semiconductor test and wireless test revenues are likely to see a respective decline of 15.4% and 28.7% in the third quarter from last-year quarter’s comparable figures.

The coronavirus-triggered supply-chain constraints are expected to have been a persistent headwind. The pandemic-induced fresh lockdowns in China might have remained a concern in the to-be-reported quarter.

The ongoing geopolitical tensions, including the Russian invasion of Ukraine, are likely to have affected the quarterly performance. The upcoming quarterly results are anticipated to reflect the impact of the new export regulations announced by the United States to cripple the Chinese tech companies.

What Our Model Says

Our proven model predicts an earnings beat for Teradyne 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, which is precisely the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Teradyne has an Earnings ESP of +1.45% and a Zacks Rank #3 at present.

Other Stocks to Consider

Here are some other stocks worth considering, as our model shows that these too have the right combination of elements to beat on earnings this season.

Fortinet FTNT has an Earnings ESP of +0.92% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Fortinet is set to report third-quarter 2022 results on Nov 2. The Zacks Consensus Estimate for FTNT’s earnings is pegged at 27 cents per share, suggesting an increase of 35% from the prior-year period’s reported figure.

The Trade Desk TTD has an Earnings ESP of +2.13% and a Zacks Rank of 2 at present.

The Trade Desk is scheduled to release third-quarter 2022 results on Nov 14. The Zacks Consensus Estimate for TTD’s earnings is pegged at 24 cents per share, suggesting an increase of 33.3% from the prior-year quarter’s reported figure.

ZoomInfo Technologies ZI has an Earnings ESP of +1.27% and a Zacks Rank of 2 at present.

ZoomInfo Technologies is scheduled to release third-quarter 2022 results on Nov 1. The Zacks Consensus Estimate for ZI’s earnings is pegged at 20 cents per share, suggesting an increase of 53.9% from the prior-year quarter’s reported figure.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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Teradyne, Inc. (TER) : Free Stock Analysis Report
 
Fortinet, Inc. (FTNT) : Free Stock Analysis Report
 
The Trade Desk (TTD) : Free Stock Analysis Report
 
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