Trade-Ideas LLC identified Teradyne ( TER) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Teradyne as such a stock due to the following factors:

  • TER has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $34.3 million.
  • TER has traded 731,621 shares today.
  • TER traded in a range 378.2% of the normal price range with a price range of $1.54.
  • TER traded above its daily resistance level (quality: 7 days, meaning that the stock is crossing a resistance level set by the last 7 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

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More details on TER:

Teradyne, Inc. designs, develops, manufactures, and sells automatic test equipment worldwide. The stock currently has a dividend yield of 1.1%. TER has a PE ratio of 2. Currently there are 5 analysts that rate Teradyne a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Teradyne has been 1.6 million shares per day over the past 30 days. Teradyne has a market cap of $4.3 billion and is part of the technology sector and electronics industry. The stock has a beta of 1.24 and a short float of 3% with 3.90 days to cover. Shares are up 2.3% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Teradyne as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 14.8%. Since the same quarter one year prior, revenues rose by 25.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • TER has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 2.85, which clearly demonstrates the ability to cover short-term cash needs.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • TERADYNE INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, TERADYNE INC increased its bottom line by earning $0.97 versus $0.37 in the prior year. This year, the market expects an improvement in earnings ($1.39 versus $0.97).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 52.5% when compared to the same quarter one year prior, rising from $32.79 million to $49.99 million.

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