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Teradata Corporation

TDC
54
Software - Infrastructure · Technology
Price
$30.52
-0.41 (-1.33%)
Market Cap
$2.87B
Winston Score
54
Winston is curious
Mixed quality — meaningful strengths and weaknesses.

Share count falling — buybacks

14.4% over 4y

The company has reduced its share count over this period, returning value to shareholders through buybacks.

Diluted shares outstanding: 112.9M (2021) → 96.6M (2025)

Teradata makes software that helps large companies store, organize, and analyze huge amounts of data. Its main product is a data analytics platform called Vantage, which lets businesses run complex queries across massive datasets to make better decisions. Teradata's customers are mostly large enterprises in industries like banking, retail, healthcare, and telecommunications.

The company earns most of its revenue through cloud subscriptions and on-premise software licenses, with a recurring revenue model that provides some stability. Teradata operates globally, with significant business in the Americas, Europe, and Asia-Pacific, and its competitive position rests on deep relationships with large enterprise customers who rely on its platform for critical operations. The key challenge Teradata faces is competition from cloud-native data platforms like Snowflake and Databricks, which have grown quickly and are winning new customers, putting pressure on Teradata to accelerate its own cloud transition to stay relevant.

Winston Score History

Score breakdown

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Quality

Gross Margin
62.2%
Premium pricing power — 62.2% gross margin
Operating Margin
-8.1%
Losing money on operations — -8.1%
ROCE
-3.6%
Weak — -3.6% return on capital

Negative ROIC means the business is losing money on every dollar invested in it.

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Growth

Sales YoY
-0.8%
Shrinking sales (-0.8% YoY)
EPS YoY
+215.4%
Earnings growing fast (215.4% YoY)

Earnings growing 25%+ a year. The compounder zone.

EPS Consistency
6/8 quarters
Earnings grew in most of the last 8 quarters

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Cash Flow

Cash Conversion
166%
Turns 166% of profit into real cash
FCF Margin
39.6%
Converts sales into free cash efficiently (39.6%)

Free cash flow margin above 20%. Out of every $100 in sales, more than $20 is real cash they keep.

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Stability

Debt / Equity
0.81
Moderate — manageable debt (0.81)
Interest Cover
8.08x
Comfortably covers interest (8.1x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

P/E Ratio (TTM)
6.8x
Attractive valuation — P/E 6.8

P/E under 10. The price tag is small relative to last year's profit.

P/E vs Forward
-6.3
SLOWING
Earnings expected to fall — forward P/E higher than today

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Dividends

Not applicable for this business.
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