Here's How Much a $1000 Investment in Teradyne Made 10 Years Ago Would Be Worth Today
How much a stock's price changes over time is a significant driver for most investors. Not only can price performance impact your portfolio, but it can help you compare investment results across sectors and industries as well.
Another factor that can influence investors is FOMO, or the fear of missing out, especially with tech giants and popular consumer-facing stocks.
What if you'd invested in Teradyne (TER) ten years ago? It may not have been easy to hold on to TER for all that time, but if you did, how much would your investment be worth today?
Teradyne's Business In-Depth
With that in mind, let's take a look at Teradyne's main business drivers.
Headquartered in North Reading, MA, Teradyne Inc. is a leading provider of automated test equipment. The company is primarily focused on the semiconductor test market, which generates the bulk of its revenues. It also provides specialized system testing equipment for specific end markets.
The semiconductor test product line primarily consists of the FLEX platform (including the IG-XL software operating system enabling single or simultaneous testing of semiconductor devices), the J750 testing system based on the IG-XL software (for very high-volume testing, as required for microprocessors) the Magnum test platform (enabling testing of memory devices produced in very large quantities) and the ETS platform (focused on analog/mixed signal discrete devices that usually have a lower pin count for testing through the proprietary SmartPin technology). Additionally, the company also offers a broad range of services across the world that helps in the deployment and functioning of its testing systems.
Customers primarily consist of semiconductor manufacturers, including integrated device manufacturers (IDMs) or foundries, as well as outsourced assembly and test subcontractors (OSATs).
The company reports revenues mainly under four segments. These segments are semiconductor Test, Industrial Automation, System Test and Wireless Test business.
The company has leveraged its expertise in semiconductor testing systems to expand into system testing for military/aerospace instrumentation, hard disk drive (including in-circuit test and x-ray inspection), printed circuit boards and automotive system diagnosis.
Teradyne has a large number of competitors, given its comprensive product portfolio.
Bottom Line
While anyone can invest, building a lucrative investment portfolio takes research, patience, and a little bit of risk. If you had invested in Teradyne ten years ago, you're probably feeling pretty good about your investment today.
A $1000 investment made in June 2011 would be worth $9,268.14, or an 826.81% gain, as of June 16, 2021, according to our calculations. Investors should note that this return excludes dividends but includes price increases.
In comparison, the S&P 500 gained 235.59% and the price of gold went up 16.84% over the same time frame.
Analysts are forecasting more upside for TER too.
Teradyne is gaining on robust Semiconductor Test and System Test businesses. Further, the company continues to benefit from expanding memory market exposure and strong product lineup. Additionally, robust Test demand and strong product lineup are major positives. Further, the company’s lean cost structure and strong balance sheet remain tailwinds. Furthermore, management is optimistic about the Universal Robots acquisition and continuous design wins. We believe that the company has significant growth opportunities in the high-growth wireless test market in the long haul. Also, rising memory and storage test shipments, and new product design wins are major positives. The stock has outperformed its industry over a year. However, weakness in the mobility test market is a serious concern. Also, sluggishness in HDD business is a major headwind.
Over the past four weeks, shares have rallied 9.72%, and there have been 7 higher earnings estimate revisions in the past two months for fiscal 2021 compared to none lower. The consensus estimate has moved up as well.
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