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The stock of Teradata (NYSE:TDC) is up 40% since my initial coverage on Seeking Alpha in late 2020 (see TDC: The Stock May Have Bottomed Out). However, the stock is down 35% over the
Teradata: Stock Has Fallen Back Into The Buy Zone
Summary
- Down 35% over the past year, and after a couple of rather dismal quarterly reports, Teradata has fallen back into the buy zone.
- I say that because TDC should generate ~$400 million of free cash flow this year (and next) giving the company an 11%+ FCF yield.
- Meantime, TDC is ideally positioned to enable its customers' use of public cloud providers (GCP, AWS, Azure).
- Teradata, while growing slower than some peers, also trades at a significant discount to companies like Snowflake and Datadog.
Michael Fitzsimmons is a retired electronics engineer and avid investor. He advises investors to construct a well-diversified portfolio built on a core foundation of a high-quality low-cost S&P500 fund. For investors who can tolerate short-term risks, he advises an over-weight position in the technology sector, which he believes is still in the early stages of a long-term secular bull-market. For dividend income, and as a 4th generation oil & gas man, Fitzsimmons suggests investors consider a position in large O&G companies that provide strong dividend income and dividend growth. Fitzsimmons' articles on portfolio management recommend a top-down capital allocation approach that is aligned with each individual investor's personal situation (i.e. age, retired/working, risk tolerance, income, net worth, goals, etc) and might include allocations into investment categories such as the S&P500, technology, dividend income, sector ETFs, growth, speculative growth, gold, and cash.
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I am an electronics engineer, not a CFA. The information and data presented in this article were obtained from company documents and/or sources believed to be reliable, but have not been independently verified. Therefore, the author cannot guarantee their accuracy. Please do your own research and contact a qualified investment advisor. I am not responsible for the investment decisions you make.
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