The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Teradyne beat expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped, and earnings per share improved significantly.
Gross margins dropped, operating margins contracted, and net margins improved.
Teradyne booked revenue of $297.0 million. The 12 analysts polled by S&P Capital IQ anticipated revenue of $284.7 million. Sales were 7.8% lower than the prior-year quarter's $322.2 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $0.16. The 13 earnings estimates compiled by S&P Capital IQ predicted $0.12 per share on the same basis. GAAP EPS of $0.56 for Q4 were 105% higher than the prior-year quarter's $0.27 per share.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 45.9%, 660 basis points worse than the prior-year quarter. Operating margin was 0.4%, 1,810 basis points worse than the prior-year quarter. Net margin was 42.1%, 2,340 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $305.8 million. On the bottom line, the average EPS estimate is $0.18.
Next year's average estimate for revenue is $1.47 billion. The average EPS estimate is $1.30.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 289 members out of 313 rating the stock outperform, and 24 members rating it underperform. Among 96 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 93 give Teradyne a green thumbs-up, and three give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Teradyne is outperform, with an average price target of $16.43.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.