Teradyne Benefiting From Earlier, Stronger Orders For 5G, Handsets, Wireless, And Memory

I thought Teradyne (NASDAQ:TER) looked undervalued on excessive pessimism back in January, but I didn't see this 60% run in the shares, as Teradyne has managed to keep putting together strong quarters relative to expectations, sending sell-side estimates higher along the way. Although there were some fears going into this quarter that Teradyne was "pulling in" demand from later in 2019, I'm not so sure that theory holds water anymore.

The record Teradyne has relative to earnings expectations is impressive, so much so that I have to wonder whether management plays it intentionally too conservative just to give themselves leeway. Whatever the story may be on that, the fact is that the company is seeing good semiconductor test demand and is gaining share in memory, while the near-term headwinds in industrial automation have been pretty well anticipated by the market. Valuation is no longer attractive, though, and I don't see that same "hey, it's not so bad" trade opportunity that I did before.

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Teradyne Benefiting From Earlier, Stronger Orders For 5G, Handsets, Wireless, And Memory