What Happened?

Shares of semiconductor testing company Teradyne (NASDAQ:TER) jumped 5.2% in the morning session after JPMorgan upgraded the stock's rating from Neutral to Overweight (Buy) and raised the price target from $145 to $158. The new price target implies a potential 20% upside from where shares traded before the upgrade was announced.

After the initial pop the shares cooled down to $129.11, up 4.7% from previous close.

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What The Market Is Telling Us

Teradyne’s shares are quite volatile and have had 15 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business. 

The biggest move we wrote about over the last year was 5 months ago when the stock dropped 15.3% on the news that the company reported weak second-quarter earnings results. Its revenue guidance for next quarter missed analysts' expectations. On the other hand, Teradyne recorded strong improvement in inventory levels, and its EPS outperformed Wall Street's estimates. The guidance seems to be weighing on shares, and the stock traded down as a result.

Teradyne is up 23.2% since the beginning of the year, but at $129.11 per share, it is still trading 20.8% below its 52-week high of $163 from July 2024. Investors who bought $1,000 worth of Teradyne’s shares 5 years ago would now be looking at an investment worth $1,890.

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