reported earnings after the closing bell on Wednesday, April 23.
The company posted earnings of $0.11 per share on revenue of $321
million. Analysts expected earnings of $0.07 on revenue of $318
million. So why did the stock fall after beating both earnings
and revenue estimates? Because the second quarter forecasts were
The daily chart shows what has transpired since the earnings
dropped 11.6% from Wednesday's close to the low on Monday, but it
appears to be reversing course now. It looks like a prime buying
The weekly chart shows the pattern that makes me think the dip
is providing a buying opportunity. You can see the trend channel
and how this week's low touched the lower rail of the channel
before it bounced. You can also see how the
dipped down below the 40 level for the fifth time in the last two
years. Each of these occurrences coincided with the stock
touching the bottom rail of the channel and each time it did, the
stock rallied at least 25% in the ensuing few months. I look for
the stock to do the same thing this time around.
The sentiment indicators also provide a positive driver behind
the trade. The short-interest ratio was at 15.6 on the last short
interest report. Since I started writing this daily article at
the beginning of April, this is the highest short-interest ratio
that I have written about yet. The short-interest ratio has
jumped from 4.6 to 15.6 since the beginning of the year. There
are 37.95 million shares of TER sold short as of April 15 and
that represents approximately 20% of the outstanding float.
This is the type of negative sentiment that can really
drive a stock higher
. If it starts to rally as I think it will, the short sellers
will be jumping over each other trying to cover their positions
and this will drive the stock considerably higher.
is lower than I would like and the analyst ratings are average,
but with the short interest ratio so high, the composite reading
is still 17.68.
I look for Teradyne stock to move higher over the next few
months and for the stock to move at least 25% higher. A weekly
close below the bottom rail would serve as my stop and my target
would be above $22.
Ian Wyatt has found 3 stocks that pay dividends so big - you
can retire on them.
The Wall Street Journal
calls them, "mega-dividends." These stocks have a history of
consistently RAISING their dividends… quarter after quarter. In
fact, one of these cash-cranking companies hiked its dividend
10-fold! So, if these ever-increasing payouts sound good to you…
Click here for all the details