Stock Analysis on Net

Teradyne Inc. (NASDAQ:TER)

This company has been moved to the archive! The financial data has not been updated since May 3, 2024.

Capital Asset Pricing Model (CAPM)

Microsoft Excel

Rates of Return

Teradyne Inc., monthly rates of return

Microsoft Excel
Teradyne Inc. (TER) Standard & Poor’s 500 (S&P 500)
t Date PriceTER,t1 DividendTER,t1 RTER,t2 PriceS&P 500,t RS&P 500,t3
Jan 31, 2019 $35.99 2,704.10
1. Feb 28, 2019 $40.83 $0.09 13.70% 2,784.49 2.97%
2. Mar 31, 2019 $39.84 -2.42% 2,834.40 1.79%
3. Apr 30, 2019 $49.00 22.99% 2,945.83 3.93%
. . . . . . .
. . . . . . .
. . . . . . .
58. Nov 30, 2023 $92.23 $0.11 10.89% 4,567.80 8.92%
59. Dec 31, 2023 $108.52 17.66% 4,769.83 4.42%
Average (R): 2.63% 1.11%
Standard deviation: 11.94% 5.31%
Teradyne Inc. (TER) Standard & Poor’s 500 (S&P 500)
t Date PriceTER,t1 DividendTER,t1 RTER,t2 PriceS&P 500,t RS&P 500,t3
Jan 31, 2019 $35.99 2,704.10
1. Feb 28, 2019 $40.83 $0.09 13.70% 2,784.49 2.97%
2. Mar 31, 2019 $39.84 -2.42% 2,834.40 1.79%
3. Apr 30, 2019 $49.00 22.99% 2,945.83 3.93%
4. May 31, 2019 $42.14 $0.09 -13.82% 2,752.06 -6.58%
5. Jun 30, 2019 $47.91 13.69% 2,941.76 6.89%
6. Jul 31, 2019 $55.73 16.32% 2,980.38 1.31%
7. Aug 31, 2019 $52.97 -4.95% 2,926.46 -1.81%
8. Sep 30, 2019 $57.91 $0.09 9.50% 2,976.74 1.72%
9. Oct 31, 2019 $61.22 5.72% 3,037.56 2.04%
10. Nov 30, 2019 $62.59 $0.09 2.38% 3,140.98 3.40%
11. Dec 31, 2019 $68.19 8.95% 3,230.78 2.86%
12. Jan 31, 2020 $65.99 -3.23% 3,225.52 -0.16%
13. Feb 29, 2020 $58.76 $0.10 -10.80% 2,954.22 -8.41%
14. Mar 31, 2020 $54.17 -7.81% 2,584.59 -12.51%
15. Apr 30, 2020 $62.54 15.45% 2,912.43 12.68%
16. May 31, 2020 $67.02 $0.10 7.32% 3,044.31 4.53%
17. Jun 30, 2020 $84.51 26.10% 3,100.29 1.84%
18. Jul 31, 2020 $88.96 5.27% 3,271.12 5.51%
19. Aug 31, 2020 $84.97 -4.49% 3,500.31 7.01%
20. Sep 30, 2020 $79.46 $0.10 -6.37% 3,363.00 -3.92%
21. Oct 31, 2020 $87.85 10.56% 3,269.96 -2.77%
22. Nov 30, 2020 $110.34 $0.10 25.71% 3,621.63 10.75%
23. Dec 31, 2020 $119.89 8.66% 3,756.07 3.71%
24. Jan 31, 2021 $113.48 -5.35% 3,714.24 -1.11%
25. Feb 28, 2021 $128.61 $0.10 13.42% 3,811.15 2.61%
26. Mar 31, 2021 $121.68 -5.39% 3,972.89 4.24%
27. Apr 30, 2021 $125.08 2.79% 4,181.17 5.24%
28. May 31, 2021 $132.35 $0.10 5.89% 4,204.11 0.55%
29. Jun 30, 2021 $133.96 1.22% 4,297.50 2.22%
30. Jul 31, 2021 $127.00 -5.20% 4,395.26 2.27%
31. Aug 31, 2021 $121.44 $0.10 -4.30% 4,522.68 2.90%
32. Sep 30, 2021 $109.17 -10.10% 4,307.54 -4.76%
33. Oct 31, 2021 $138.24 26.63% 4,605.38 6.91%
34. Nov 30, 2021 $152.87 $0.10 10.66% 4,567.00 -0.83%
35. Dec 31, 2021 $163.53 6.97% 4,766.18 4.36%
36. Jan 31, 2022 $117.43 -28.19% 4,515.55 -5.26%
37. Feb 28, 2022 $117.92 $0.11 0.51% 4,373.94 -3.14%
38. Mar 31, 2022 $118.23 0.26% 4,530.41 3.58%
39. Apr 30, 2022 $105.46 -10.80% 4,131.93 -8.80%
40. May 31, 2022 $109.26 $0.11 3.71% 4,132.15 0.01%
41. Jun 30, 2022 $89.55 -18.04% 3,785.38 -8.39%
42. Jul 31, 2022 $100.89 12.66% 4,130.29 9.11%
43. Aug 31, 2022 $84.64 $0.11 -16.00% 3,955.00 -4.24%
44. Sep 30, 2022 $75.15 -11.21% 3,585.62 -9.34%
45. Oct 31, 2022 $81.35 8.25% 3,871.98 7.99%
46. Nov 30, 2022 $93.45 $0.11 15.01% 4,080.11 5.38%
47. Dec 31, 2022 $87.35 -6.53% 3,839.50 -5.90%
48. Jan 31, 2023 $101.70 16.43% 4,076.60 6.18%
49. Feb 28, 2023 $101.14 $0.11 -0.44% 3,970.15 -2.61%
50. Mar 31, 2023 $107.51 6.30% 4,109.31 3.51%
51. Apr 30, 2023 $91.38 -15.00% 4,169.48 1.46%
52. May 31, 2023 $100.19 $0.11 9.76% 4,179.83 0.25%
53. Jun 30, 2023 $111.33 11.12% 4,376.86 4.71%
54. Jul 31, 2023 $112.94 1.45% 4,588.96 4.85%
55. Aug 31, 2023 $107.87 $0.11 -4.39% 4,507.66 -1.77%
56. Sep 30, 2023 $100.46 -6.87% 4,288.05 -4.87%
57. Oct 31, 2023 $83.27 -17.11% 4,193.80 -2.20%
58. Nov 30, 2023 $92.23 $0.11 10.89% 4,567.80 8.92%
59. Dec 31, 2023 $108.52 17.66% 4,769.83 4.42%
Average (R): 2.63% 1.11%
Standard deviation: 11.94% 5.31%

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1 Data in US$ per share of common stock, adjusted for splits and stock dividends.

2 Rate of return on common stock of TER during period t

3 Rate of return on S&P 500 (the market portfolio proxy) during period t


Variance and Covariance

Teradyne Inc., calculation of variance and covariance of returns

Microsoft Excel
t Date RTER,t RS&P 500,t (RTER,tRTER)2 (RS&P 500,tRS&P 500)2 (RTER,tRTER)×(RS&P 500,tRS&P 500)
1. Feb 28, 2019 13.70% 2.97% 122.53 3.49 20.67
2. Mar 31, 2019 -2.42% 1.79% 25.54 0.47 -3.47
3. Apr 30, 2019 22.99% 3.93% 414.66 7.98 57.54
. . . . . . .
. . . . . . .
. . . . . . .
58. Nov 30, 2023 10.89% 8.92% 68.29 61.03 64.56
59. Dec 31, 2023 17.66% 4.42% 226.01 11.00 49.87
Total (Σ): 8,264.99 1,634.30 2,554.74
t Date RTER,t RS&P 500,t (RTER,tRTER)2 (RS&P 500,tRS&P 500)2 (RTER,tRTER)×(RS&P 500,tRS&P 500)
1. Feb 28, 2019 13.70% 2.97% 122.53 3.49 20.67
2. Mar 31, 2019 -2.42% 1.79% 25.54 0.47 -3.47
3. Apr 30, 2019 22.99% 3.93% 414.66 7.98 57.54
4. May 31, 2019 -13.82% -6.58% 270.44 59.04 126.36
5. Jun 30, 2019 13.69% 6.89% 122.40 33.49 64.03
6. Jul 31, 2019 16.32% 1.31% 187.51 0.04 2.83
7. Aug 31, 2019 -4.95% -1.81% 57.48 8.50 22.10
8. Sep 30, 2019 9.50% 1.72% 47.16 0.37 4.20
9. Oct 31, 2019 5.72% 2.04% 9.53 0.88 2.89
10. Nov 30, 2019 2.38% 3.40% 0.06 5.28 -0.56
11. Dec 31, 2019 8.95% 2.86% 39.92 3.07 11.08
12. Jan 31, 2020 -3.23% -0.16% 34.28 1.61 7.43
13. Feb 29, 2020 -10.80% -8.41% 180.46 90.57 127.84
14. Mar 31, 2020 -7.81% -12.51% 109.00 185.44 142.17
15. Apr 30, 2020 15.45% 12.68% 164.42 134.06 148.47
16. May 31, 2020 7.32% 4.53% 22.04 11.71 16.07
17. Jun 30, 2020 26.10% 1.84% 550.74 0.54 17.20
18. Jul 31, 2020 5.27% 5.51% 6.95 19.40 11.61
19. Aug 31, 2020 -4.49% 7.01% 50.61 34.82 -41.98
20. Sep 30, 2020 -6.37% -3.92% 80.92 25.29 45.24
21. Oct 31, 2020 10.56% -2.77% 62.88 15.00 -30.71
22. Nov 30, 2020 25.71% 10.75% 532.94 93.10 222.75
23. Dec 31, 2020 8.66% 3.71% 36.32 6.79 15.71
24. Jan 31, 2021 -5.35% -1.11% 63.61 4.93 17.70
25. Feb 28, 2021 13.42% 2.61% 116.47 2.26 16.22
26. Mar 31, 2021 -5.39% 4.24% 64.27 9.85 -25.16
27. Apr 30, 2021 2.79% 5.24% 0.03 17.11 0.68
28. May 31, 2021 5.89% 0.55% 10.65 0.31 -1.82
29. Jun 30, 2021 1.22% 2.22% 1.99 1.24 -1.58
30. Jul 31, 2021 -5.20% 2.27% 61.22 1.37 -9.15
31. Aug 31, 2021 -4.30% 2.90% 48.00 3.22 -12.42
32. Sep 30, 2021 -10.10% -4.76% 162.12 34.37 74.65
33. Oct 31, 2021 26.63% 6.91% 575.97 33.74 139.40
34. Nov 30, 2021 10.66% -0.83% 64.43 3.76 -15.57
35. Dec 31, 2021 6.97% 4.36% 18.87 10.60 14.14
36. Jan 31, 2022 -28.19% -5.26% 949.83 40.51 196.15
37. Feb 28, 2022 0.51% -3.14% 4.49 17.99 8.98
38. Mar 31, 2022 0.26% 3.58% 5.60 6.11 -5.85
39. Apr 30, 2022 -10.80% -8.80% 180.36 98.04 132.98
40. May 31, 2022 3.71% 0.01% 1.16 1.21 -1.19
41. Jun 30, 2022 -18.04% -8.39% 427.18 90.21 196.30
42. Jul 31, 2022 12.66% 9.11% 100.69 64.09 80.33
43. Aug 31, 2022 -16.00% -4.24% 346.94 28.62 99.65
44. Sep 30, 2022 -11.21% -9.34% 191.57 109.11 144.57
45. Oct 31, 2022 8.25% 7.99% 31.60 47.34 38.68
46. Nov 30, 2022 15.01% 5.38% 153.28 18.23 52.86
47. Dec 31, 2022 -6.53% -5.90% 83.84 49.04 64.12
48. Jan 31, 2023 16.43% 6.18% 190.42 25.70 69.96
49. Feb 28, 2023 -0.44% -2.61% 9.43 13.82 11.42
50. Mar 31, 2023 6.30% 3.51% 13.46 5.76 8.80
51. Apr 30, 2023 -15.00% 1.46% 310.89 0.13 -6.32
52. May 31, 2023 9.76% 0.25% 50.87 0.74 -6.12
53. Jun 30, 2023 11.12% 4.71% 72.08 13.02 30.63
54. Jul 31, 2023 1.45% 4.85% 1.40 13.99 -4.42
55. Aug 31, 2023 -4.39% -1.77% 49.29 8.28 20.20
56. Sep 30, 2023 -6.87% -4.87% 90.22 35.73 56.78
57. Oct 31, 2023 -17.11% -2.20% 389.67 10.92 65.22
58. Nov 30, 2023 10.89% 8.92% 68.29 61.03 64.56
59. Dec 31, 2023 17.66% 4.42% 226.01 11.00 49.87
Total (Σ): 8,264.99 1,634.30 2,554.74

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VarianceTER = Σ(RTER,tRTER)2 ÷ (59 – 1)
= 8,264.99 ÷ (59 – 1)
= 142.50

VarianceS&P 500 = Σ(RS&P 500,tRS&P 500)2 ÷ (59 – 1)
= 1,634.30 ÷ (59 – 1)
= 28.18

CovarianceTER, S&P 500 = Σ(RTER,tRTER)×(RS&P 500,tRS&P 500) ÷ (59 – 1)
= 2,554.74 ÷ (59 – 1)
= 44.05


Systematic Risk (β) Estimation

Microsoft Excel
VarianceTER 142.50
VarianceS&P 500 28.18
CovarianceTER, S&P 500 44.05
Correlation coefficientTER, S&P 5001 0.70
βTER2 1.56
αTER3 0.90%

Calculations

1 Correlation coefficientTER, S&P 500
= CovarianceTER, S&P 500 ÷ (Standard deviationTER × Standard deviationS&P 500)
= 44.05 ÷ (11.94% × 5.31%)
= 0.70

2 βTER
= CovarianceTER, S&P 500 ÷ VarianceS&P 500
= 44.05 ÷ 28.18
= 1.56

3 αTER
= AverageTER – βTER × AverageS&P 500
= 2.63%1.56 × 1.11%
= 0.90%


Expected Rate of Return

Microsoft Excel
Assumptions
Rate of return on LT Treasury Composite1 RF 4.67%
Expected rate of return on market portfolio2 E(RM) 13.79%
Systematic risk (β) of Teradyne Inc. common stock βTER 1.56
 
Expected rate of return on Teradyne Inc. common stock3 E(RTER) 18.92%

1 Unweighted average of bid yields on all outstanding fixed-coupon U.S. Treasury bonds neither due or callable in less than 10 years (risk-free rate of return proxy).

2 See details »

3 E(RTER) = RF + βTER [E(RM) – RF]
= 4.67% + 1.56 [13.79%4.67%]
= 18.92%