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The latest earnings announcement Teradyne, Inc. (NASDAQ:TER) released in December 2018 signalled that the business benefited from a sizeable tailwind, leading to a high double-digit earnings growth of 75%. Below, Iâve laid out key numbers on how market analysts predict Teradyneâs earnings growth outlook over the next few years and whether the future looks even brighter than the past. Note that I will be looking at net income excluding extraordinary items to get a better understanding of the underlying drivers of earnings.
See our latest analysis for Teradyne
Market analystsâ consensus outlook for this coming year seems pessimistic, with earnings falling by a double-digit -24%. Beyond this, earnings will begin to improve, rising year on year, and reaching US$441m by 2022.
While it is helpful to be aware of the growth each year relative to todayâs value, it may be more beneficial to determine the rate at which the business is growing every year, on average. The benefit of this method is that we can get a better picture of the direction of Teradyneâs earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To compute this rate, Iâve inserted a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is -0.7%. This means that, we can assume Teradyne will chip away at a rate of -0.7% every year for the next couple of years.
For Teradyne, there are three pertinent aspects you should further examine:
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publication had no position in the stocks mentioned. For errors
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