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Teradyne (TER) to Report Q4 Earnings: What's in the Cards?

Teradyne TER is scheduled to report its fourth-quarter 2022 results on Jan 25.

For the fourth quarter, TER expects revenues between $670 million and $750 million. The Zacks Consensus Estimate for sales is pegged at $710.3 million, indicating a decline of 19.7% from the year-ago quarter’s reported value.

Teradyne anticipates non-GAAP earnings per share between 62 cents and 86 cents. The consensus mark for earnings is pegged at 74 cents, indicating a 46% fall from the previous-year quarter’s reported figure.

TER’s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average being 8.9%.

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

In the fourth quarter, Teradyne is expected to have continued facing sluggishness in the Semiconductor Test business due to weak test demand than the year-ago quarter.

Nevertheless, the test demand is expected to have improved sequentially with rising automotive test demand. Strength in the UltraFLEX platform, ADAS processors and the Eagle platform is likely to have benefited the business in the to-be-reported quarter.

Increasing shipment of ADAS processors, silicon carbide drives, charging ICs and battery management devices are likely to have been tailwinds.

Growing momentum across research and development applications, and strong design wins are likely to have contributed well.

Apart from these, increasing semiconductor content for electric vehicles, autonomous driving and auto infotainment are expected to have contributed well to the performance of the System Test business in the fourth quarter. Solid momentum in analog industrial is likely to have been another positive.

Coming to the Industrial Automation business, softness in the industrial demand, labour scarcity in the distribution channel and foreign exchange headwinds are expected to have been major overhangs.

Nevertheless, well-performing Universal Robots and Mobile Industrial Robots (MiR) are expected to have benefited the business in the quarter under review.

Strengthening demand for Universal Robots’ UR20 and its solid momentum in the OEM channel are likely to have been positives.

MiR’s robust services and spares, along with growing momentum across large customers, are likely to have contributed well.

However, weakness in Teradyne’s Wireless Test business is expected to have impacted its quarterly performance negatively. Sluggish smartphone and PC end-markets are expected to have been concerning.

The coronavirus pandemic-triggered uncertainties, supply-chain disruptions and rising geo-political tensions are expected to have been headwinds.

What Our Model Says

Our proven model does not conclusively predict 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 not 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 -0.12% and a Zacks Rank #4 (Sell) at present.

Stocks to Consider

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

MSCI MSCI has an Earnings ESP of +0.43% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

MSCI is scheduled to release its fourth-quarter 2022 results on Jan 31. The Zacks Consensus Estimate for MSCI’s earnings is pegged at $2.71 per share, suggesting an increase of 7.97% from the prior-year quarter’s reported figure.

Endava DAVA has an Earnings ESP of +1.97% and a Zacks Rank #3 at present.

Endava is set to report second-quarter fiscal 2023 results on Feb 15. The Zacks Consensus Estimate for DAVA’s earnings is pegged at 68 cents per share, suggesting an increase of 7.94% from the prior-year period’s reported figure.

Analog Devices ADI has an Earnings ESP of +2.99% and a Zacks Rank #3 at present

Analog Devices is scheduled to release its first-quarter fiscal 2023 results on Feb 15. The Zacks Consensus Estimate for ADI’s earnings is pegged at $2.59 per share, suggesting an increase of 33.5% from the prior-year quarter’s reported figure.

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

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