Insider Activity Casts a Cloud Over Teradata Corporation (TDC)

Despite closing -0.14 points lower on 08 February, Teradata Corporation (NYSE:TDC) remains a key investment for many, but the stock is also a popular trading vehicle. Here’s how to trade it using charts and trading levels Monday. The shares dropped -0.3 percent at $45.86 with a heavy trade volume of 2.923 million shares. After opening the session at $44.99, the shares went as high as $47.22 and as low as $44.78, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $5.44 billion and now has 118.56 million shares outstanding. Teradata Corporation (TDC) stock has gained 14.68 percent of market value in 21 trading days.

TDC stock has a trailing 3-year beta of 0.96, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $0.5 a share in the trailing twelve months. The stock’s value has surged 19.55 percent year to date (YTD) against a rise of 14.36 percent in 12 month’s time. The company’s shares still trade -1.88 percent away from its 1-year high of $46.74 and 36.37 percent up from 52-week low of $33.63. The average consensus rating on the company is 3, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a hold.

Teradata Corporation (TDC) will probably climb -9.35 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $60 price as 12-month high target. This represents a whopping 30.83 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $45, which represents a return potential of -1.88 percent when compared to the closing price of the stock of $45.86 on Friday, February 08. The lowest price target for the stock is $32 — slightly more than -30.22 percent from TDC’s current share price.

History has shown that shares in Teradata Corporation have gone down on 21 different earnings reaction days and are predicted to add 0.05 percent when the company reports upcoming earnings. Investors will get their next glimpse of TDC’s Q1 earnings on May 06. Analysts are forecasting revenue to suffer decline of -9.6 percent to $566M in the fiscal first quarter, while earnings are seen soaring by nearly -24.14 percent to $0.44 per share. It earned $0.36 per share, better than the $0.31, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $588M, better than the $566M analysts expected. Earnings are estimated to increase by -50.7 percent this year, 35.96 percent next year and continue to increase by 11.3 percent annually for the next 5 years.

Let’s take a look at some insider activity at Teradata Corporation (NYSE:TDC) and see the pattern. The earliest insider trade took place on 11/05/2018. Culhane Mark gathered a total of 6.9 thousand shares of company at average share price of $35.11. The total for the purchase was set at $242.26 thousand. After this transaction, the EVP & CFO account balance stood at 36.82 thousand shares. The stock grew 30.62 percent since that insider purchase. On 08/13/2018, Harrington Daniel L, EVP, Customer Support & Svcs, sold 13 thousand shares at a price per share of $40.35. This removed 524.55 thousand shares from the insider’s fortune and the stock saw a 13.66 percent rally in value since the news became public. This transaction left 135.27 thousand shares in the EVP, Customer Support & Svcs account.

On 03/06/2018, Director Ringler James M performed a sale transaction worth $313.71 thousand. This sale at $41.85 each has eliminated 7.5 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded 9.58 percent increase since the transaction was reported. The insider now is left with 133.87 thousand shares remaining in the account. Nyquist Laura K, who performs the General Counsel & Secretary job, sold 52.38 thousand shares for $2.17 million. The disposal occurred on 03/05/2018 was priced at $41.52 per share. The share price soared 10.45 percent since the reporting date. Nyquist Laura K now left with a stake of 100.11 thousand TDC stock worth $4.59 million after the insider selling.

The stock is currently hovering around the first support level of $44.69. Below this, the next support is placed in the zone of $43.51. Till the time, the TDC stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 72.48 on daily chart, which may remain a cause for concern. If the price breaks below $43.51 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $47.13 mark may result into a pull-back move towards $48.39 level.

Shares of Teradata Corporation (TDC) are trading at a P/E ratio of 239.05 times earnings reported for the past 12 months. The industry TDC operates in has an average P/E of 20.98. Its P/E ratio went as low as 18.78X and as high as 156.7 over the 5-year span.Further, it is sporting a 2.47 on the Price-to-Sales ratio. Compare this with the industry average P/S of 400.15. 47.4 percent is the gross profit margin for Teradata Corporation and operating margin sits at 3.3 percent. Along with this, the net profit margin is -2.9 percent.