Teradata (TDC) Shares Skyrocket, What You Need To Know

Petr Huřťák /
2023/05/05 12:39 pm EDT

What Happened:

Shares of data and analytics software provider Teradata (NYSE:TDC) jumped 6.26% in the pre-market session after the company reported first-quarter annual recurring revenue (ARR), revenue, gross margin, and free cash flow that exceeded analysts' expectations. Guidance for the next quarter came in ahead of Consensus and the full year outlook was largely maintained. Management highlighted the strong ARR growth, and customer's growing usage of its cloud offerings showed that the investments in the cloud are paying off, and the trend is inline with the positive results we've seen from bigger cloud players like Microsoft (Azure) and Amazon (AWS) this quarter.

What is the market telling us:

Teradata's shares are not very volatile than the market average and over the last year have had only 7 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business. The previous big move was 4 days ago, when the company gained 6.23% on the news that analyst Howard Ma of Guggenheim upgraded the stock's rating from Neutral (Hold) to Buy, and maintained a price target of $62. The price target implies a potential 50% upside from the current level.

Teradata is up 32.7% since the beginning of the year, TODO Investors who bought $1,000 worth of Teradata's shares 5 years ago would now be looking at an investment worth $1,150.

Is now the time to buy Teradata? Access our full analysis of the earnings results here, it's free.