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Teradyne has the Financial Strength Rank of 10. It shows strong financial strength and is unlikely to fall into distressed situations.
Good Sign:
Teradyne Inc shows strong financial strength.
GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is rated on a scale of 1 to 10 and is based on these factors:
1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.A higher score indicates a stronger financial position, with companies rated 7 or above considered financially stable and unlikely to face distress. Conversely, a score of 3 or below suggests potential financial difficulties, indicating a higher risk of distress.
Teradyne's Interest Coverage for the quarter that ended in Dec. 2024 was 269.11. Teradyne's debt to revenue ratio for the quarter that ended in Dec. 2024 was 0.03. As of today, Teradyne's Altman Z-Score is 11.37.
For the Semiconductor Equipment & Materials subindustry, Teradyne's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
For the Semiconductors industry and Technology sector, Teradyne's Financial Strength distribution charts can be found below:
* The bar in red indicates where Teradyne's Financial Strength falls into.
GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors
A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.
1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:
Teradyne's Interest Expense for the months ended in Dec. 2024 was $-1 Mil. Its Operating Income for the months ended in Dec. 2024 was $159 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2024 was $58 Mil.
Teradyne's Interest Coverage for the quarter that ended in Dec. 2024 is
Interest Coverage | = | -1 | * | Operating Income (Q: Dec. 2024 ) | / | Interest Expense (Q: Dec. 2024 ) |
= | -1 | * | 158.505 | / | -0.589 | |
= | 269.11 |
The higher the ratio, the stronger the company's financial strength is.
Good Sign:
Ben Graham prefers companies' interest coverage to be at least 5. Teradyne Inc has enough cash to cover all of its debt. Its financial situation is stable.
2. Debt to revenue ratio. The lower, the better.
Teradyne's Debt to Revenue Ratio for the quarter that ended in Dec. 2024 is
Debt to Revenue Ratio | = | Total Debt (Q: Dec. 2024 ) | / | Revenue | ||
= | (Short-Term Debt & Capital Lease Obligation | + | Long-Term Debt & Capital Lease Obligation) | / | Revenue | |
= | (18.699 | + | 57.922) | / | 3011.536 | |
= | 0.03 |
3. Altman Z-Score.
Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.
The zones of discrimination were as such:
When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.
Teradyne has a Z-score of 11.37, indicating it is in Safe Zones. This implies the Z-Score is strong.
Good Sign:
Altman Z-score of 11.37 is strong.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Teradyne (NAS:TER) Financial Strength Explanation
The rank is rated on a scale of 1 to 10. A higher score indicates a stronger financial position, with companies rated 7 or above considered financially stable and unlikely to face distress. Conversely, a score of 3 or below suggests potential financial difficulties, indicating a higher risk of distress.
Teradyne has the Financial Strength Rank of 10. It shows strong financial strength and is unlikely to fall into distressed situations.
Thank you for viewing the detailed overview of Teradyne's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.
Richard John Burns | officer: President, Semiconductor Test | MINDSPEED TECHNOLOGIES, INC., 9 TECHNOLOGY DRIVE, WESTBOROUGH MA 01581 |
Sanjay Mehta | officer: VP and Chief Financial Officer | C/O TERADYNE INC., 600 RIVERPARK DRIVE, NORTH READING MA 01864 |
Mercedes Johnson | director | MICRON TECHNOLOGY, INC, 8000 S FEDERAL WAY, MS 1-557, BOISE ID 83716 |
Gregory Stephen Smith | officer: President, Semiconductor Test | 1 HUCKLEBERRY RD, HOPKINTON MA 01748-1054 |
Marilyn Matz | director | C/O LOGMEIN, INC., 320 SUMMER STREET, BOSTON MA 02210 |
Ernest E Maddock | director | LAM RESEARCH, 4650 CUSHING PARKWAY, FREMONT CA 94538 |
Brad Robbins | officer: President, LitePoint Corp. | C O LITEPOINT, 965 WEST MAUDE AVE, SUNNYVALE CA 94085 |
Ujjwal Kumar | officer: President, Teradyne Robotics | C/O TERADYNE, INC., 600 RIVERPARK DRIVE, NORTH READING MA 01864 |
Charles Jeffrey Gray | officer: VP, General Counsel, Secretary | 600 RIVERPARK DRIVE, NORTH READING MA 01864 |
Mark E Jagiela | director, officer: President and CEO | 321 HARRISON AVE, C/O TERADYNE INC, BOSTON MA 02118 |
Peter Herweck | director | 600 RIVERPARK DRIVE, NORTH READING MA 01864 |
Paul J Tufano | director | C/O SOLECTRON CORPORATION, 847 GIBRALTAR DR., MILPITAS CA 95035 |
Ford Tamer | director | 3945 FREEDOM CIRCLE SUITE 1100, SANTA CLARA CA 95054 |
Timothy E Guertin | director | C/O VARIAN MEDICAL SYSTEMS, INC, 3100 HANSEN WAY M/S E-327, PALO ALTO CA 94304 |
Edwin J Gillis | director | C/O VERITAS SOFTWARE CORP, 350 ELLIS STREET, MOUNTAIN VIEW CA 94043 |
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