Teradata Corp /De/ (NYSE: TDC)

Sector: Technology Industry: Software - Infrastructure CIK: 0000816761
P/B 13.00
P/E 24.13
P/S 1.72
Market Cap 2.85 Bn
ROIC (Qtr) 18.15
Div Yield % 0.00
Rev 1y % (Qtr) -5.45
Total Debt (Qtr) 573.00 Mn
Debt/Equity (Qtr) 2.62

About

Teradata Corporation, commonly known as TDC, operates in the data management and analytics industry. This market is rapidly expanding due to the growing demand for data-driven insights and decision-making. Teradata's main business activities involve providing a range of solutions and services designed to help organizations enhance business performance, enrich customer experiences, and integrate data across the enterprise. The company's primary product is its cloud-native platform, Teradata Vantage. This platform offers a variety of analytics and...

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Analysis

Pros

  • Strong operating cash flow of 301M provides robust 0.53x coverage of total debt 573M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 406M provide 4.83x coverage of short-term debt 84M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 301M provides exceptional 11.15x coverage of interest expenses 27M, showing strong debt service capability.
  • Robust free cash flow of 282M exceeds capital expenditure of 19M by 14.84x, indicating strong organic growth funding capability.
  • Free cash flow of 282M provides exceptional 10.44x coverage of interest expense 27M, showing strong debt service ability.

Cons

  • Operating cash flow of 301M barely covers its investment activities of (21M), with a coverage ratio of -14.33, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (21M) provide weak support for R&D spending of 275M, which is -0.08x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Cash reserves of 406M provide limited coverage of acquisition spending of (6M), which is -67.67x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Operating cash flow of 301M provides insufficient coverage of deferred revenue obligations of 539M, which is 0.56x, raising concerns about future service delivery capabilities.
  • High receivables of 309M relative to inventory of 5M (61.80 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.

Peer Comparison

Companies in the Software - Infrastructure
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 MSFT Microsoft Corp 3,542.10 Bn 33.76 12.06 60.56 Bn
2 ORCL Oracle Corp 533.93 Bn 34.61 8.75 124.39 Bn
3 PLTR Palantir Technologies Inc. 437.56 Bn 399.47 112.31 0.24 Bn
4 PANW Palo Alto Networks Inc 125.16 Bn 112.03 13.10 0.35 Bn
5 CRWD CrowdStrike Holdings, Inc. 120.85 Bn -384.67 26.47 0.82 Bn
6 SNPS Synopsys Inc 71.69 Bn 35.89 11.14 15.14 Bn
7 NET Cloudflare, Inc. 67.84 Bn -658.43 33.70 3.50 Bn
8 FTNT Fortinet, Inc. 63.33 Bn 33.80 9.66 1.00 Bn

Industry Comparisons

Current Valuation

Metric Value Industry Percentile
EV to Assets 1.74 2.56
EV to Cash from Ops. 10.17 38.32
EV to Debt 5.34 -11.37
EV to EBIT 16.82 -12.79
EV to EBITDA 10.97 7.72
EV to Free Cash Flow [EV/FCF] 10.86 24.22
EV to Market Cap 1.08 0.58
EV to Revenue 1.85 -35.00
Price to Book Value [P/B] 13.00 3.74
Price to Earnings [P/E] 24.13 -18.61

Dividend Metrics

Metric Value Industry Percentile
Dividend Coverage Ratio 0.00 -0.30
Dividend Payout Ratio % 0.00 2.69
Dividend per Basic Share 0.00 0.10
FCF Dividend Payout Ratio % 0.00 1.67
Interest Coverage 6.74 -13.15

Growth Metrics

Metric Value Industry Percentile
Capex Growth (1y) % 26.92 -404.11
Cash and Equivalents Growth (1y) % 16.67 226.02
Dividend Growth (1y) % 0.00 -0.27
EBIAT Growth (1y) % 41.72 31.15
EBITDA Growth (1y) % -14.15 49.02
EBIT Growth (1y) % -2.15 25.85
EBT Growth (1y) % -0.64 17.82
EPS Growth (1y) % 44.71 70.69
FCF Growth (1y) % -5.05 295.45
Gross Profit Growth (1y) % -10.89 49.96

Liquidity Ratios

Metric Value Industry Percentile
Asset Utilization Ratio 0.94 0.68
Cash Payout Ratio 0.00 0.02
Cash Ratio 0.45 1.21
Current Ratio 0.90 2.57
Debt to Equity Ratio 2.62 -0.93
Interest Cover Ratio 6.74 -13.15
Times Interest Earned 6.74 -13.15

Profitability

Metric Value Industry Percentile
EBITDA Margin % 16.40 -544.82
EBIT Margin % 11.02 -197.78
EBT Margin % 9.39 -602.74
Gross Margin % 59.00 52.06
Net Profit Margin % 7.10 -605.52