Teradyne (TER) Outpaces Stock Market Gains: What You Should Know

Teradyne (TER) closed at $162.90 in the latest trading session, marking a +1.47% move from the prior day. This move outpaced the S&P 500's daily gain of 0.28%. Elsewhere, the Dow gained 0.11%, while the tech-heavy Nasdaq added 0.14%.

Coming into today, shares of the maker of wireless products, data storage and equipment to test semiconductors had gained 2.95% in the past month. In that same time, the Computer and Technology sector lost 4.59%, while the S&P 500 gained 0.12%.

Investors will be hoping for strength from Teradyne as it approaches its next earnings release. The company is expected to report EPS of $1.29, up 17.27% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $867.39 million, up 14.29% from the prior-year quarter.

Investors might also notice recent changes to analyst estimates for Teradyne. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.5% higher. Teradyne is currently a Zacks Rank #2 (Buy).

Looking at its valuation, Teradyne is holding a Forward P/E ratio of 25.39. For comparison, its industry has an average Forward P/E of 26.58, which means Teradyne is trading at a discount to the group.

Investors should also note that TER has a PEG ratio of 1.7 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Electronics - Testing Equipment industry currently had an average PEG ratio of 2.97 as of yesterday's close.

The Electronics - Testing Equipment industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 108, putting it in the top 43% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow TER in the coming trading sessions, be sure to utilize Zacks.com.

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