Teradyne, a prominent automation and testing company, has received a significant upgrade from J.P. Morgan, shifting its rating from Underweight to Neutral. The upgrade comes as the smartphone market shows signs of improvement, reducing the risks faced by Teradyne in the future. As a result, the company’s shares experienced a 2.2% increase in premarket trading on Thursday.
One of the key factors influencing this upgrade is Teradyne’s revised expectations for 2024. The company recently reported flat revenues and lower earnings compared to the previous year. However, these projections align with the forecasted growth in the smartphone market, which is expected to recover in the second half of 2024. In particular, Teradyne anticipates an increase in complexity with node migrations for key customers like Qualcomm (QCOM), as well as a rising demand for AI smartphones. These factors are likely to drive additional opportunities for the company.
Within its Memory Test market, Teradyne expects a growth rate of approximately 10% in 2024. Notably, this segment demonstrated remarkable progress, achieving a 47% year-over-year increase during the fourth quarter of 2023.
J.P. Morgan also raised Teradyne’s price target, setting it at $100, up from the previous $90. This indicates a strong belief in the company’s potential for future success.
Although Seeking Alpha analysts rate Teradyne as a HOLD, Wall Street analysts consider it a BUY. Additionally, Seeking Alpha’s quant system, known for consistently outperforming the market, also rates Teradyne as a HOLD.
The recent upgrade and positive outlook for Teradyne demonstrate the company’s ability to adapt to market changes and capitalize on emerging opportunities. With the stabilization of the smartphone market and the projected growth in its key sectors, Teradyne appears poised for a promising future.
The source of the article is from the blog reporterosdelsur.com.mx