Critical Review: Teradyne (NASDAQ:TER) & Bel Fuse (NASDAQ:BELFA)

Bel Fuse (NASDAQ:BELFA) and Teradyne (NASDAQ:TER) are both computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, valuation, profitability, earnings, analyst recommendations and dividends.

Valuation & Earnings

This table compares Bel Fuse and Teradyne”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bel Fuse	$675.46 million	3.57	$61.54 million	$4.65	41.00
Teradyne	$3.19 billion	14.51	$554.05 million	$3.48	84.95

Teradyne has higher revenue and earnings than Bel Fuse. Bel Fuse is trading at a lower price-to-earnings ratio than Teradyne, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Bel Fuse has a beta of 1.19, indicating that its stock price is 19% more volatile than the S&P 500. Comparatively, Teradyne has a beta of 1.76, indicating that its stock price is 76% more volatile than the S&P 500.

Profitability

This table compares Bel Fuse and Teradyne’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bel Fuse	9.11%	21.78%	9.42%
Teradyne	17.37%	22.68%	16.19%

Dividends

Bel Fuse pays an annual dividend of $0.24 per share and has a dividend yield of 0.1%. Teradyne pays an annual dividend of $0.52 per share and has a dividend yield of 0.2%. Bel Fuse pays out 5.2% of its earnings in the form of a dividend. Teradyne pays out 14.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Bel Fuse has raised its dividend for 1 consecutive years and Teradyne has raised its dividend for 1 consecutive years.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Bel Fuse and Teradyne, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bel Fuse	0	1	0	1	3.00
Teradyne	0	6	9	1	2.69

Bel Fuse presently has a consensus price target of $250.00, suggesting a potential upside of 31.13%. Teradyne has a consensus price target of $273.73, suggesting a potential downside of 7.40%. Given Bel Fuse’s stronger consensus rating and higher probable upside, research analysts plainly believe Bel Fuse is more favorable than Teradyne.

Insider & Institutional Ownership

6.0% of Bel Fuse shares are owned by institutional investors. Comparatively, 99.8% of Teradyne shares are owned by institutional investors. 5.5% of Bel Fuse shares are owned by insiders. Comparatively, 0.2% of Teradyne shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Teradyne beats Bel Fuse on 11 of the 16 factors compared between the two stocks.

About Bel Fuse

Bel Fuse Inc. designs, manufactures, markets, and sells products that power, protect, and connect electronic circuits. The company's products are used in the networking, telecommunications, computing, general industrial, high-speed data transmission, military, commercial aerospace, transportation, and e-Mobility industries. It provides power solutions and protection products, including front-end power supplies, board-mount power products, industrial and transportation power products, external power products, and circuit protection products. The company also offers connectivity solutions, such as expanded beam fiber optic connectors, cable assemblies, and active optical devices; copper-based connectors/cable assemblies; radio frequency connectors, cable assemblies, microwave devices, and low loss cables; and ethernet, I/O, and industrial and power connectivity products. In addition, it provides magnetic solutions comprising integrated connector modules, power transformers, SMD power inductors and SMPS transformers, and ethernet discrete components. The company sells its products through direct strategic account managers, regional sales managers working with independent sales representative organizations, and authorized distributors in the United States, the People's Republic of China, Macao, the United Kingdom, Slovakia, Germany, India, Switzerland, and internationally. Bel Fuse Inc. was incorporated in 1949 and is headquartered in West Orange, New Jersey.

About Teradyne

Teradyne, Inc. designs, develops, manufactures, and sells automated test systems and robotics products worldwide. It operates through four segments; Semiconductor Test, System Test, Robotics, and Wireless Test. The Semiconductor Test segment offers products and services for wafer level and device package testing of semiconductor devices in automotive, industrial, communications, consumer, smartphones, cloud, computer and electronic game, and other applications. This segment also provides FLEX test platform systems; J750 test system to address the volume semiconductor devices, including microcontrollers; Magnum platform that tests memory devices, such as flash memory and DRAM; and ETS platform for semiconductor manufacturers, and assembly and test subcontractors in the analog/mixed signal markets. It serves integrated device manufacturers that integrate the fabrication of silicon wafers into their business; fabless companies that outsource the manufacturing of silicon wafers; foundries; and semiconductor assembly and test providers. The System Test segment offers defense/aerospace test instrumentation and systems; storage and system level test systems; and circuit-board test and inspection systems. The Wireless Test segment provides wireless test solutions for silicon validation, wireless module manufacturing, and wireless end device manufacturing under the LitePoint brand. This segment also offers IQxel-MX and IQxel-MW7G series products for edge measurement performance in the manufacturing of connectivity products; IQxstream-5G and IQgig-5G family products to support 4G and 5G technologies; and IQgig-UWB+ for certification and manufacturing test support for ultra wideband products. The Robotics segment provides collaborative robotic arms, autonomous mobile robots, and advanced robotic control software for manufacturing, logistics, and industrial customers. The company was incorporated in 1960 and is headquartered in North Reading, Massachusetts.