Stock Analysis | Teradyne Outlook - A Mixed Bag for Tech Investors

Market Snapshot

Headline Takeaway: Teradyne (TER.O) has shown a 4.25% price increase recently, but technical indicators suggest weak technology and a need for caution. Our internal diagnostic score (0-10) for technical strength is 4.56.

News Highlights

• McKinsey weighs in on tariffs and chip supply chains: New research explores potential U.S. tariff impacts on semiconductor supply chains. While the ruling remains uncertain, the sector is expected to face ongoing regulatory turbulence.
• Japan to Offer U.S. Proposals for Cooperation on Rare Earths, Semiconductors: A potential joint initiative could counter China's dominance and correct the trade deficit, offering long-term stability for semiconductor players like Teradyne.
• US Semiconductors ETF SOXX Faces $750M Net Outflow: A large outflow in May 2025 highlights investor caution in the sector. While not directly affecting Teradyne, it could impact broader market sentiment.

Analyst Views & Fundamentals

Four major institutions, including JP Morgan and UBS, have issued ratings recently. The simple average rating is 3.80, while the performance-weighted rating is 4.62, indicating stronger confidence in the latter metric.

• Rating Consistency: The ratings are not aligned, with three "Neutral" and two "Strong Buy" ratings. This suggests a mixed market view.
• Price Trend Alignment: The recent price increase of 4.25% aligns with the weighted expectations, as the market remains optimistic.
• Fundamental Factors:
  • Net cash flow from operating activities per share (YoY growth rate %): -95.32% (score: 1)
  • Net profit attributable to parent company shareholders / Net profit (%): 100.00% (score: 1)
  • EV/EBIT: 91.39 (score: 3)
  • Total profit (YoY growth rate %): -30.18% (score: 3)
  • Net cash flow from operating activities (YoY growth rate %): 53.90% (score: 3)
  • Cash-UP: 6.31 (score: 3)
  • Interest coverage ratio (EBIT / Interest expense) (%): -89.41% (score: 2)
  • GPOA: 9.92 (score: 3)
  • Net profit attributable to parent company shareholders (YoY growth rate %): -29.23% (score: 3)
  • Cash-MV: -0.71 (score: 0)

  Overall, the internal diagnostic score (0-10) for fundamentals is 5.03, suggesting moderate strength with some concerning trends in profitability and cash flow.

Money-Flow Trends

Big-money and retail flows show a mixed picture. The fund flow score (0-10) is 7.55, indicating generally positive movement in the last week. Notably:

• Small investor trend: Positive (52.82% inflow ratio).
• Medium and large investor trends: Mixed — large and extra-large flows are negative, while medium flows are positive.
• Block trend: Negative (43.73% inflow ratio).

Investors appear to be more active on the retail side, suggesting short-term optimism, while big money remains cautious.

Key Technical Signals

The internal diagnostic score (0-10) for technical indicators is 4.56, suggesting a weak trend with a need for caution. The chart has produced a Bullish Engulfing pattern on September 2, 2025, which has an internal diagnostic score (0-10) of 8.12, indicating strong bullish bias.

• WR Overbought has shown up frequently in the last 5 days (as of September 4, 2025), with a score of 1, indicating a bearish bias. This pattern historically leads to an average return of -0.9% with a 38.78% win rate.
• Bullish Engulfing is a rare but strong indicator with a historical win rate of 75.0% and average return of 1.72%.

Key Insight: Technical indicators show that the market is in a volatile state, and the direction is not clear enough. Long and short signals are relatively balanced, and investors are advised to pay close attention to market changes.

Conclusion

While Teradyne has shown a recent price rise, the technical and fundamental signals remain mixed. With a weak technical score and moderate fundamental strength, we recommend waiting for clearer momentum before making large moves. Investors might consider keeping an eye on the bullish engulfing pattern for potential entry points, but caution is still warranted. The sector’s regulatory and market headwinds remain a key wildcard.