Imagine a world where data isn’t just a collection of numbers, but a powerful tool that transforms industries and enhances everyday life. Teradata Corporation, a pivotal player in the Software – Infrastructure sector, empowers enterprises with its innovative multi-cloud data platform, Teradata Vantage, allowing them to unlock the true potential of their data. With a reputation for quality and a commitment to driving cloud migrations, Teradata shapes the future of analytics. As I analyze its market position, I ponder whether its fundamentals continue to support its current valuation and growth trajectory.
Table of contents
Company Description
Teradata Corporation (TDC), founded in 1979 and headquartered in San Diego, California, is a prominent player in the software infrastructure sector. Specializing in enterprise analytics, Teradata provides a connected multi-cloud data platform, notably through its flagship product, Teradata Vantage. This platform enables organizations to harness and analyze their data efficiently, supporting a seamless migration to the cloud. Operating across diverse sectors including financial services, healthcare, and telecommunications, Teradata’s global reach spans the Americas, Europe, the Middle East, Africa, Asia Pacific, and Japan. With a workforce of 5.7K employees, the company is strategically positioned as a leader in data-driven decision-making, emphasizing innovation and ecosystem strength in the evolving analytics landscape.
Fundamental Analysis
In this section, I will analyze Teradata Corporation’s income statement, financial ratios, and dividend payout policy to assess its financial health and investment potential.
Income Statement
The following table summarizes Teradata Corporation’s income statement for the fiscal years from 2020 to 2024, illustrating key financial metrics that investors should consider.
| Metrics | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Revenue | 1.836B | 1.917B | 1.795B | 1.833B | 1.750B |
| Cost of Revenue | 817M | 731M | 714M | 718M | 692M |
| Operating Expenses | 1.003B | 955M | 963M | 929M | 849M |
| Gross Profit | 1.019B | 1.186B | 1.081B | 1.115B | 1.058B |
| EBITDA | 175M | 367M | 225M | 263M | 293M |
| EBIT | 3M | 218M | 91M | 147M | 193M |
| Interest Expense | 27M | 26M | 24M | 30M | 29M |
| Net Income | 129M | 147M | 33M | 62M | 114M |
| EPS | 1.18 | 1.35 | 0.32 | 0.62 | 1.18 |
| Filing Date | 2021-02-26 | 2022-02-25 | 2023-02-24 | 2024-02-23 | 2025-02-21 |
Interpretation of Income Statement
Over the analyzed period, Teradata’s revenue has shown fluctuations, peaking at 1.917B in 2021, before declining slightly to 1.750B in 2024. Notably, Net Income has increased to 114M in 2024 from 62M in 2023, indicating a positive trend in profitability. The gross profit margin has remained relatively stable, reflecting effective cost control strategies, particularly in operating expenses, which decreased significantly in 2024. This improvement suggests that Teradata may be successfully optimizing its operations, potentially positioning itself favorably for future growth. However, the revenue decline in 2024 warrants close monitoring as it could indicate market challenges ahead.
Financial Ratios
Here is a summary of the financial ratios for Teradata Corporation (TDC) over the last few years.
| Ratios | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Net Margin | 7.03% | 7.67% | 1.84% | 3.38% | 6.51% |
| ROE | 32.25% | 31.96% | 12.79% | 45.93% | 85.71% |
| ROIC | 1.29% | 12.61% | 4.99% | 10.18% | 16.89% |
| P/E | 19.04 | 31.38 | 105.26 | 70.04 | 26.34 |
| P/B | 6.14 | 10.03 | 13.46 | 32.17 | 22.58 |
| Current Ratio | 1.10 | 1.07 | 1.02 | 0.87 | 0.81 |
| Quick Ratio | 1.07 | 1.05 | 1.01 | 0.86 | 0.79 |
| D/E | 1.61 | 1.24 | 2.47 | 4.74 | 4.33 |
| Debt-to-Assets | 29.32% | 26.37% | 31.50% | 34.17% | 33.80% |
| Interest Coverage | 0.59 | 8.88 | 4.92 | 6.20 | 7.21 |
| Asset Turnover | 0.84 | 0.88 | 0.89 | 0.98 | 1.03 |
| Fixed Asset Turnover | 4.87 | 6.11 | 6.98 | 7.39 | 9.07 |
| Dividend Yield | 0 | 0 | 0 | 0 | 0 |
Interpretation of Financial Ratios
Teradata Corporation (TDC) presents a mixed financial profile based on its latest ratios for FY 2024. The liquidity ratios, with a current ratio of 0.81 and quick ratio of 0.79, indicate potential short-term liquidity issues, suggesting the company may struggle to meet its short-term obligations. The solvency ratio at 0.14 reflects a moderate level of debt relative to assets, yet the debt-to-equity ratio of 4.33 raises concerns about financial leverage. Profitability ratios are relatively weak, with a net profit margin of only 6.51%, indicating challenges in translating revenue into profit. While the return on equity is strong at 85.71%, the lack of dividend payments and high price-to-earnings ratio of 26.34 suggest that investors might be paying a premium for expected growth rather than current profitability.
Evolution of Financial Ratios
Over the past five years, Teradata’s ratios have shown a concerning downtrend in profitability, particularly in net profit margins, which have decreased from 7.67% in 2021 to 6.51% in 2024. Meanwhile, liquidity ratios have generally weakened, highlighting increasing operational challenges.
Distribution Policy
Teradata Corporation (TDC) does not pay dividends, reflecting a strategy focused on reinvestment and growth. The company is in a high-growth phase, prioritizing research and development and potential acquisitions over immediate shareholder payouts. While TDC engages in share buyback programs, this approach must be carefully managed to avoid excessive repurchases that could jeopardize long-term value creation. Overall, the lack of dividends aligns with a commitment to sustainable growth, though continued assessment of cash flow and market conditions is essential.
Sector Analysis
Teradata Corporation (TDC) operates in the Software – Infrastructure industry, offering a multi-cloud data platform that enhances enterprise analytics. Its primary competitors include major firms in data analytics and cloud services, with competitive advantages stemming from its unique platform integration and consulting services.
Strategic Positioning
Teradata Corporation (TDC) occupies a competitive space in the software infrastructure market, specializing in multi-cloud data platforms for enterprise analytics. With a market capitalization of approximately $2.63B, TDC has established a notable presence but faces pressure from emerging technologies and competitors offering similar analytics solutions. Currently, Teradata’s key product, Teradata Vantage, is well-positioned, yet ongoing technological disruptions necessitate continuous innovation to maintain market share. As I analyze TDC’s standing, I remain cautious of the competitive landscape and the potential impacts of rapid technological advancements on its business model.
Revenue by Segment
The following chart illustrates the revenue distribution by segment for Teradata Corporation for the fiscal year 2024.
In FY 2024, Teradata’s revenue segments exhibited varied performance. The “Product And Service, Recurring” segment led with $1.48B, closely followed by “Services And Other, Recurring” at $1.19B. Notably, “Consulting Services” saw a decline to $248M, reflecting a challenging environment in consulting. The shift towards recurring revenue is evident, indicating a strategic focus on subscription models. However, the decrease in consulting revenue suggests potential margin pressure and highlights the need for Teradata to bolster this segment to mitigate concentration risks in recurring revenues going forward.
Key Products
Teradata Corporation offers a range of innovative products that empower organizations to manage and analyze their data effectively. Below is a table summarizing some of their key products.
| Product | Description |
|---|---|
| Teradata Vantage | A connected multi-cloud data platform designed for enterprise analytics, allowing seamless data integration and analytics across various sources. |
| Business Consulting | Services that help organizations establish data and analytic visions, operationalize analytical opportunities, and implement multi-cloud ecosystem architectures. |
| Support Services | Comprehensive support and maintenance services to ensure the analytical infrastructure delivers ongoing value to clients. |
| Data Migration Tools | Tools and services that facilitate the migration of data to cloud environments, simplifying the transition process for enterprises. |
| Analytical Solutions | Tailored solutions that enable businesses in various sectors, such as finance and healthcare, to leverage their data for strategic decision-making. |
These products not only enhance data management capabilities but also support businesses in their digital transformation journeys.
Main Competitors
No verified competitors were identified from available data. However, Teradata Corporation (TDC) operates in the Software – Infrastructure sector, focusing on providing a multi-cloud data platform for enterprise analytics. With a market cap of approximately 2.63B, Teradata holds a competitive position in the analytics market, serving diverse industries such as financial services, healthcare, and telecommunications.
Competitive Advantages
Teradata Corporation (TDC) holds significant competitive advantages in the data analytics space through its robust multi-cloud platform, Teradata Vantage. This platform allows enterprises to integrate and analyze vast data sources seamlessly, enhancing decision-making capabilities. With a market cap of $2.63B and a beta of 0.61, TDC demonstrates stability and growth potential. Looking forward, the company is poised to expand its product offerings and explore new markets, particularly in industries like healthcare and telecommunications. These opportunities, combined with their strong consulting services, position Teradata well for continued success in an evolving data landscape.
SWOT Analysis
The purpose of this analysis is to evaluate Teradata Corporation’s strengths, weaknesses, opportunities, and threats to better inform investment decisions.
Strengths
- Strong market position
- Innovative technology solutions
- Diverse client base
Weaknesses
- Lack of recent dividends
- High competition
- Dependence on large clients
Opportunities
- Growing demand for data analytics
- Expansion into new markets
- Cloud migration trends
Threats
- Economic downturns
- Rapid technological changes
- Regulatory challenges
Overall, Teradata’s strengths position it well in a growing market, but its weaknesses and external threats necessitate careful monitoring. The company should focus on leveraging emerging opportunities while managing competitive pressures.
Stock Analysis
Over the past year, Teradata Corporation (TDC) has experienced significant price movements, highlighting a pronounced bearish trend and notable volatility in its trading dynamics.
Trend Analysis
Analyzing the stock’s performance over the last year, TDC has seen a percentage change of -34.88%, indicating a bearish trend. This decline is characterized by acceleration, as evidenced by a standard deviation of 7.28, which underscores the volatility in its price movements. The stock reached a high of 48.99 and a low of 19.73 during this period, illustrating considerable fluctuation.
Volume Analysis
In examining trading volumes over the last three months, the total volume amounted to 611.15M, with buyer volume at 332.88M and seller volume at 269.48M, resulting in a buyer percentage of 54.47%. This suggests an increasing volume trend, with recent activity being slightly buyer-dominant (53.47% buyer behavior). This increase in volume indicates a heightened investor interest and participation in the stock, despite the overall bearish sentiment in price performance.
Analyst Opinions
Recent analyst recommendations for Teradata Corporation (TDC) indicate a consensus rating of “buy.” Analysts have highlighted strong performance in return on equity (score of 5) and discounted cash flow metrics (score of 4) as key factors driving their optimism. Notably, the overall score of 3 reflects balanced performance, despite a lower score in debt-to-equity (1). Analysts suggest that Teradata’s robust fundamentals position it well for future growth. Overall, I find the bullish sentiment backed by solid financial indicators encouraging for investors considering TDC in their portfolios.
Stock Grades
Teradata Corporation (TDC) has recently received several stock ratings from reputable grading companies, highlighting its evolving market position.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Citizens | Upgrade | Market Outperform | 2025-11-10 |
| Evercore ISI Group | Maintain | Outperform | 2025-11-05 |
| Barclays | Maintain | Underweight | 2025-11-05 |
| TD Cowen | Maintain | Hold | 2025-11-05 |
| UBS | Maintain | Neutral | 2025-08-06 |
| Guggenheim | Maintain | Buy | 2025-05-07 |
| Barclays | Maintain | Underweight | 2025-04-21 |
| Citizens Capital Markets | Maintain | Market Perform | 2025-03-18 |
| JMP Securities | Maintain | Market Perform | 2025-02-13 |
| RBC Capital | Maintain | Sector Perform | 2025-02-12 |
Overall, the trend indicates a cautious optimism, with Citizens upgrading TDC to “Market Outperform,” while some firms maintain a more conservative stance with “Underweight” ratings. This reflects a mixed sentiment among analysts, suggesting that while there is potential for growth, some risks remain apparent.
Target Prices
The consensus target price for Teradata Corporation (TDC) is firmly set at $24, indicating consistent expectations among analysts.
| Target High | Target Low | Consensus |
|---|---|---|
| 24 | 24 | 24 |
Overall, analysts are unified in their expectations for TDC, reflecting a stable outlook for the company.
Consumer Opinions
Consumer sentiment about Teradata Corporation (TDC) reveals a mix of satisfaction and concerns, reflecting the diverse experiences of its users.
| Positive Reviews | Negative Reviews |
|---|---|
| “Excellent data analytics capabilities!” | “High cost compared to competitors.” |
| “User-friendly interface and robust support.” | “Complexity in integration with existing systems.” |
| “Great for large-scale data management.” | “Performance issues during peak usage.” |
Overall, consumer feedback indicates that while Teradata excels in data analytics and support, concerns about pricing and integration complexity persist.
Risk Analysis
In evaluating Teradata Corporation (TDC), it’s essential to understand the potential risks that could impact the company’s performance. Below is a summary of key risks:
| Category | Description | Probability | Impact |
|---|---|---|---|
| Market Volatility | Fluctuations in market conditions affecting demand. | High | High |
| Technological Change | Rapid changes in technology could outdate offerings. | Medium | High |
| Competitive Pressure | Increased competition may erode market share. | High | Medium |
| Regulatory Changes | New regulations may impose additional costs. | Medium | Medium |
| Cybersecurity Threats | Risk of data breaches impacting reputation. | High | High |
Synthesis: The most pressing risks for Teradata include market volatility and cybersecurity threats, both of which have a high probability and significant potential impact on operations. As the tech landscape evolves, staying ahead of these challenges is crucial for sustained growth.
Should You Buy Teradata Corporation?
Teradata Corporation is currently showing a positive net margin of 6.51% and has a return on invested capital (ROIC) of 16.89%, which exceeds its weighted average cost of capital (WACC) of 5.79%. However, the company also carries a high debt-to-equity ratio of 4.74, indicating significant leverage.
Favorable signals The company’s net margin is positive, which highlights its ability to generate profit from its revenue. Additionally, Teradata’s ROIC is greater than its WACC, suggesting effective capital utilization and value creation for shareholders.
Unfavorable signals The company has a high debt-to-equity ratio at 4.74, indicating high financial leverage, which may pose risks in adverse market conditions. Furthermore, the overall stock trend is bearish, with a significant price change of -34.88% recently, which could signal ongoing investor concerns.
Conclusion Considering the favorable signals of a positive net margin and ROIC that exceeds WACC, it might appear favorable for long-term investors. However, the unfavorable aspects of high leverage and a bearish stock trend suggest caution.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Additional Resources
- Magnetar Financial LLC Makes New Investment in Teradata Corporation $TDC – MarketBeat (Nov 25, 2025)
- Teradata Corporation’s (NYSE:TDC) 28% Price Boost Is Out Of Tune With Earnings – simplywall.st (Nov 22, 2025)
- Teradata (NYSE: TDC) to Present at UBS, Barclays Investor Conferences Dec. 3 & 10 – Stock Titan (Nov 24, 2025)
- Teradata (TDC) Soars 32% on Q3 Blowout, Upbeat Outlook – Yahoo Finance (Nov 06, 2025)
- Teradata Q3: It Has Gotten Too Cheap To Ignore (NYSE:TDC) – Seeking Alpha (Nov 06, 2025)
For more information about Teradata Corporation, please visit the official website: teradata.com
