DCF Tool

TER

Teradyne, Inc. – Instrument Manufacturing for Measuring and Testing Electricity and Electrical Signals
Teradyne brings high-quality innovations such as smart devices, life-saving medical equipment and data storage systems to market, faster. Its advanced test solutions for semiconductors, electronic systems, wireless devices and more ensure that products perform as they were designed. Its Industrial Automation offerings include collaborative and mobile robots that help manufacturers of all sizes improve productivity and lower costs. In 2019, Teradyne had revenue of $2.3 billion and today employs 5,500 people worldwide.
Analysis Results
Intrinsic Value $182.08
Latest Price $102.37
Relative Value 44% undervalued
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Cash Flow (Billions)
Analysis Parameters
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Analysis Details
Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 33.5%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 13.6%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 33.5%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year Future flow (billion) Present value (billion)
2022 1.51 1.33
2023 2.02 1.56
2024 2.69 1.84
2025 3.6 2.16
2026 4.8 2.54
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 42.3 billion. This corresponds to a present value of 19.7 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 9.44 billion. Adding in the terminal value gives a total present value of 29.2 billion.

There are presently 160.0 million outstanding shares, so the intrinsic value per share is 182.08.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 2,576,227,000
Current Cash 1,366,430,000
Current Liabilities 805,120,000
Current Debt 19,182,000
Non-Cash Working Capital (NCWC) 423,859,000
Change in NCWC 112,354,000
EBIT 1,210,032,000
Tax Provision 146,366,000
Depreciation and Amortization 125,485,000
Capital Expenditure -132,472,000
Unlevered Free Cash Flow 1,162,845,676
Current Assets 2,415,434,000
Current Cash 1,436,401,000
Current Liabilities 700,871,000
Current Debt 33,343,000
Non-Cash Working Capital (NCWC) 311,505,000
Change in NCWC 102,877,000
EBIT 915,205,000
Tax Provision 116,868,000
Depreciation and Amortization 126,743,000
Capital Expenditure -184,977,000
Unlevered Free Cash Flow 841,139,456
Current Assets 1,658,884,000
Current Cash 911,227,000
Current Liabilities 539,029,000
Current Debt 0
Non-Cash Working Capital (NCWC) 208,628,000
Change in NCWC 69,281,000
EBIT 539,774,000
Tax Provision 58,304,000
Depreciation and Amortization 120,655,000
Capital Expenditure -134,642,000
Unlevered Free Cash Flow 535,211,287
Current Assets 1,732,482,000
Current Cash 1,116,848,000
Current Liabilities 476,287,000
Current Debt 0
Non-Cash Working Capital (NCWC) 139,347,000
Change in NCWC 101,224,000
EBIT 489,029,000
Tax Provision 16,022,000
Depreciation and Amortization 113,224,000
Capital Expenditure -114,379,000
Unlevered Free Cash Flow 572,348,949
Current Assets 2,270,281,000
Current Cash 1,777,822,000
Current Liabilities 454,336,000
Current Debt 0
Non-Cash Working Capital (NCWC) 38,123,000
Change in NCWC -34,076,000
EBIT 539,390,000
Tax Provision 266,720,000
Depreciation and Amortization 108,075,000
Capital Expenditure -105,375,000
Unlevered Free Cash Flow 233,676,073
Current Assets 1,623,803,000
Current Cash 1,178,908,000
Current Liabilities 372,696,000
Current Debt 0
Non-Cash Working Capital (NCWC) 72,199,000
Change in NCWC -72,511,000
EBIT 300,212,000
Tax Provision -11,639,000
Depreciation and Amortization 120,009,000
Capital Expenditure -85,272,000
Unlevered Free Cash Flow 262,438,000
Current Assets 1,259,968,000
Current Cash 742,401,000
Current Liabilities 372,857,000
Current Debt 0
Non-Cash Working Capital (NCWC) 144,710,000
Change in NCWC 21,313,000
EBIT 248,049,000
Tax Provision 46,647,000
Depreciation and Amortization 140,773,000
Capital Expenditure -89,878,000
Unlevered Free Cash Flow 274,545,247
Current Assets 1,243,846,000
Current Cash 828,043,000
Current Liabilities 292,406,000
Current Debt 0
Non-Cash Working Capital (NCWC) 123,397,000
Change in NCWC -99,391,000
EBIT 196,685,000
Tax Provision 14,104,000
Depreciation and Amortization 152,544,000
Capital Expenditure -168,982,000
Unlevered Free Cash Flow 51,770,640
Current Assets 1,440,277,000
Current Cash 928,520,000
Current Liabilities 475,632,000
Current Debt 186,663,000
Non-Cash Working Capital (NCWC) 222,788,000
Change in NCWC 52,663,000
EBIT 192,739,000
Tax Provision 36,975,000
Depreciation and Amortization 150,687,000
Capital Expenditure -106,731,000
Unlevered Free Cash Flow 254,064,547
Current Assets 1,236,061,000
Current Cash 770,436,000
Current Liabilities 297,828,000
Current Debt 2,328,000
Non-Cash Working Capital (NCWC) 170,125,000
Change in NCWC 111,587,000
EBIT 279,647,000
Tax Provision 48,927,000
Depreciation and Amortization 142,799,000
Capital Expenditure -119,080,000
Unlevered Free Cash Flow 363,511,182

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