Topic: Growth Stocks

Teradata Corp. $26 – New York symbol TDC

TERADATA CORP. $26 (New York symbol TDC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 179.7 million; Market cap: $4.7 billion; WSSF Rating: Average) was a wholly owned subsidiary of NCR Corp. until October 1, 2007. NCR stockholders received one Teradata share for each NCR share held.

Teradata helps businesses capture, store and analyze a wide variety of data, such as customer buying habits. That helps its clients make better decisions, and expand profits. The stock got as high as $30 just after it began trading. It then fell to $20 in April 2008 due to fears that the slowing economy would prompt businesses to delay or cut capital spending.

In the first quarter of 2008, Teradata’s earnings grew 16.7%, to $0.28 a share from $0.24 a year earlier. The latest figure excludes costs related to the spinoff from NCR. Revenue rose 2.2%, to $375 million from $367 million, largely due to favorable foreign exchange rates. Overseas customers account for about 45% of Teradata’s total revenue.

The company should earn $1.39 a share in 2008, and the stock trades at 18.7 times that estimate.

Teradata is a buy.

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