Teradata Corp Dossier - Source-backed chat

Teradata Corp

TDCNYSE

SectorInformation Technology

IndustrySoftware - Infrastructure

Beta (adjusted)0.72

Intrinsic Value $106.19median of 6 methods · middle span $33-$203based on filings through 30 Jun 2026

Market Price $28.84Price as of 30 Sep 2026

Significantly undervaluedIntrinsic value is 268% above the market price

−50% · IV below pricenear fair value ±15%IV above price · +50%

marker beyond scale (+268%)

Data confidence Sign in to view data confidence

Market Cap $2.7B

Enterprise Value $2.3B

Shares Outstanding 96M diluted

Moat Rating Wide

Next Earnings Date9 Nov 2026

All prices and values are periodic snapshots, not live quotes. Source dates are shown for reference.

Thesis

Street consensus, scenarios, merits, risks, and invalidation triggers

AI-assisted

Thesis Summary

Teradata enters 2026 with a stabilized business model centered on its hybrid, cloud-neutral Autonomous Knowledge Platform. While the company continues to generate robust free cash flow—bolstered significantly by a $480 million gross settlement with SAP in Q1 2026—and maintains strong operational discipline, its top-line growth remains under pressure. Decelerating cloud ARR growth and intense competition from hyperscalers and cloud-native platforms like Snowflake limit near-term upside. The stock trades at a deep discount relative to software peers, reflecting market skepticism regarding the long-term durability of its revenue model and the pace of enterprise AI adoption.

This section is the 12-month view: analyst targets and the probability-weighted scenarios built from them. The intrinsic value at the top of this page answers a different question: what the business is worth today.

Street view · analyst 12-month targets8 analysts · as of 18 Aug 2026

Low · most bearish analyst$27.00

Mean target$34.00

High · most bullish analyst$49.00

Our research · scenarios, merits, risks, and invalidation triggersResearch as of 18 Sep 2026

Scenarios · 12-month scenario targetsAnchored at research date

Bear CaseDownside scenario

$27.00

The bear case is driven by accelerated customer migration to cloud-native alternatives, vendor consolidation, and price wars in the hybrid-cloud space. In this scenario, Teradata experiences market share loss, leading to a revenue decline of ~2% annually. Squeezed operating margins from higher R&D requirements for AI innovation and a failure of new AI initiatives to drive material growth would result in multiple compression and downward revisions to long-term earnings estimates.

Base CaseCentral scenario

$34.00

Matches the consensus mean

The base case reflects flat to slightly declining total revenue (-2% to flat) and modest total ARR growth of 2% to 4% for FY 2026, in line with management's reaffirmed guidance. Operating margins remain stable due to cost controls and a high mix of recurring subscription revenue (90% of total revenue in Q1 2026). Free cash flow generation remains healthy, but top-line expansion is constrained by tight IT budgets and competitive pressures.

Bull CaseUpside scenario

$49.00

The bull case assumes Teradata successfully capitalizes on growing enterprise demand for hybrid cloud deployments and sovereign AI workloads. By leveraging its newly unified Data, AI, and Technology Services leadership under Josh Fecteau, the company accelerates product innovation (e.g., next-gen on-prem platforms with embedded GPUs) and improves operating leverage. This scenario projects steady margin expansion, recurring revenue growth of ~1% to 2%, and aggressive share repurchases utilizing its strong cash reserves.

Scenarios are anchored to street consensus at the research date, with our probabilities and rationale.

Key Investment Merits

Strong cash flow generation, supported by a $480 million gross litigation settlement with SAP in Q1 2026
High recurring revenue mix (90% of total revenue in Q1 2026) providing business model stability
Established footprint in large, complex enterprise accounts requiring robust hybrid data management

Key Investment Risks

Intense competition from well-capitalized hyperscalers (AWS, Google Cloud, Microsoft) and cloud-native platforms (Snowflake, Databricks)
Decelerating cloud ARR growth and flat-to-declining overall top-line revenue trends
Execution and key-person risk associated with the consolidation of Data, AI, and IT functions under a single leader

Thesis Invalidation Triggers

Total ARR growth falling below the guided 2% to 4% range for FY 2026
Significant customer churn or failure to convert AI proofs-of-concept into recurring subscription revenue
Operating margin erosion due to aggressive price competition or unexpected restructuring costs

All scenarios are estimates and subject to change. Past performance is not indicative of future results.

Quality Pillars Members

This section is available to registered members. Create a free account or sign in to unlock the full breakdown.

Explore this dossier

ValuationIntrinsic value, the six-method breakdown, peer medians, and your assumptions sandbox.Financial SnapshotRevenue, profitability, returns, balance sheet, dividends, and the filing-level detail.Qualitative AnalysisBusiness overview, strategic initiatives, and mergers, acquisitions & partnerships.Outlook & Key DatesForward estimates, reporting calendar, and the monitoring framework.