Teledyne Technologies TDY
Technology · Hardware, Equipment & Parts · Synthos Deep Dive · 2026-07-03
The Overview
Teledyne makes the sensors, cameras, and specialized electronics that go inside other people's machines — infrared and X-ray imaging, industrial machine-vision cameras, marine and environmental instruments, defense electronics, and space hardware. You rarely see its name, but its parts are everywhere from factory quality-control lines to military drones (it owns FLIR, the big thermal-imaging brand). It grows mainly by buying up small niche companies and running them well — the same playbook as Danaher or Roper.
The business is excellent and steady. The problem is the price: the stock trades at about 33 times last year's earnings, but the underlying business is only growing sales in the low single digits. You're paying a premium ticket for a slow-and-steady ride. That is why our verdict is Watch — a great company we'd rather own cheaper, not a screaming buy today.
Here's what our three scores mean in everyday terms:
- Downside Risk 4/10 (fairly safe). The company barely uses debt, the stock doesn't swing wildly, and it makes real cash — but the high price means a disappointment would hurt.
- Growth Quality 5/10 (solid, middle of the road). Profits grow at a decent clip, but a lot of that growth is bought (via acquisitions), not organic, and its returns on money invested are only okay.
- Exponential Potential 3/10 (low). This is a mature, $30-billion company in slow-growing markets. Expect a steady grind higher, not a rocket.
The one big worry: you're paying up for quality, so if growth stays in the low single digits the stock could simply drift or de-rate even if the business does fine.
Important honesty note: No outside expert in the Synthos knowledge base covers Teledyne. This write-up is built entirely from the company's own numbers and our valuation work — there is no crowd of star investors backing it either way.
Putting a number on it: our fair-value estimate is $660 against a current price of $621.96 — real upside if our numbers are right.
Our summary metrics
Low beta (0.92), net-debt/EBITDA 1.3× and de-levering — but 33× trailing on ~5% organic growth leaves little margin.
~14% forward EPS CAGR but only ~5% forward revenue CAGR; growth is acquisition-fed, ROIC ~7%, margins slowly rising.
Decelerating industrial compounder, $30B cap in mature end-markets — steady, not exponential.
What does “fair value” mean?
Fair value is Synthos’s estimate of what one share is worth today, based on our model of the company’s future cash generation and the risks to it. It is not a price target or a prediction of where the stock trades next quarter — it’s the price where we think risk and reward are balanced. Above it, you’re paying for outcomes better than our base case; below it, the market is offering a margin of safety.
The model’s inputs and weightings are proprietary — they’re the product. What we publish is the output, plus an independent, public-math cross-check further down the page (“Check our number”) so you can judge it for yourself.
What do the 5 tiers mean? (Core · Tactical · Watch · Hold · Avoid)
Exponential Potential
Decelerating industrial compounder, $30B cap in mature end-markets — steady, not exponential.
What could take this further than the base case — and where the market may be underpricing it. Full forward-growth and acceleration math in Deeper analysis, §4 below.
Deeper analysis
Technicals, fundamentals, valuation, and the full expert-claim evidence panel — the detail behind the numbers above.
Reference table
| Street consensus | $713 (high $775 / low $614; 12 Buy · 4 Hold · 2 Sell) — context, not our anchor |
| Valuation | 33× trailing GAAP EPS · ~27× FY26E non-GAAP · ~25× FY27E · ~23× FY28E · EV/S 5.2× · EV/EBITDA 21× |
| Technicals | Uptrend — $652, −5.3% off 52-wk high, above 50/200-DMA, RSI 63, +27% 12-mo (SPY +21%) |
| Conviction | None from experts — 0 net-bullish voices, 0 KB claims. Verdict rests on fundamentals + quant only |
| Position sizing | If owned, a 2–4% quality-industrial holding; not a high-conviction overweight at this price |
What the experts actually said
No independent expert claims in the Synthos knowledge base yet for TDY — this dive is fundamentals- and technicals-driven, not panel-driven.
Price & moving averages 12 months · 50 & 200-day averages · 52-week range
Solid line = price · dashed line = 50-day average · dotted line = 200-day average · the two thin horizontal lines mark the 52-week high and low. Price above both averages is an uptrend.
Data summary: last close $621.96, 4% below the 50-day average ($647), 2% above the 200-day average ($611) — a mixed trend. 10% below the 52-week high of $691, 28% above the 52-week low of $484.
Bollinger Bands 20-day average ± 2 standard deviations
The shaded band widens when the stock gets more volatile. Riding the upper edge = strong momentum (sometimes stretched); the lower edge = weak / potentially oversold.
Data summary: price $621.96 is currently inside the band (band $610–$712).
RSI (14) momentum gauge · 0–100
Above 70 (overbought zone, shaded) = overbought, below 30 (oversold zone, shaded) = oversold. Currently 36.
MACD 12 / 26 / 9 · trend & momentum
The MACD line crossing above the signal line (bars flip to the up color) = momentum turning up; crossing below (bars flip to the down color) = turning down. Bar height = the size of that gap.
Data summary: MACD is currently below its signal line by 6.41, negative momentum.
Relative performance vs S&P 500 & its sector (XLK (sector)), set to 100 a year ago
Solid = TDY · dashed = S&P 500 · dotted = XLK (sector). A rising line means it is beating that benchmark — the sector line shows whether it is a leader or laggard within its own group.
Forward revenue & earnings actual → estimate · "FY" = fiscal year, "E" = estimate
Darker bars = actual results, brighter = analyst estimates. Taller bars to the right = expected growth.
Key stats an RIA wants
1. What it is
Teledyne Technologies (NYSE: TDY) is a ~$30B diversified industrial-technology company headquartered in Thousand Oaks, CA, founded in 1960 and run for decades on a serial-acquisition, decentralized-operating model — it buys niche leaders in sensing, imaging, instrumentation and defense electronics and compounds them. The transformative deal was the 2021 acquisition of FLIR (thermal/infrared imaging), which roughly doubled the Digital Imaging segment and reshaped the company. Fiscal year ends late December.
Revenue mix — by segment (FY2025, from filings):
- Digital Imaging — $3,163.9M (52%) — infrared/X-ray/visible imaging, machine-vision cameras, MEMS & semiconductors, unmanned air systems (includes FLIR). The growth engine.
- Instrumentation — $1,457.1M (24%) — marine, environmental, and electronic test & measurement instruments.
- Aerospace & Defense Electronics — $1,058.7M (17%) — defense electronics, avionics data/comms, interconnects. Fastest-growing in FY25 (up from $776.8M in FY24, boosted by acquisitions).
- Engineered Systems — $435.7M (7%) — systems engineering, space, energy, and defense manufacturing. Flat/mature.
By geography (FY2025 non-US disclosed): Europe $1,525.8M · Asia $894.4M · other $512.4M; the balance (~$3.2B, ~53%) is United States. The revenue base is roughly split US / international, with a meaningful defense and government component that is both a stability anchor and a budget-cycle risk (§11).
The strategic story is simple and durable: buy niche technology leaders, integrate, de-lever, repeat — with organic growth in the low-to-mid single digits and M&A layered on top.
2. The expert thesis — why the panel is bullish (traceable)
There is no expert thesis to report. The Synthos knowledge base contains zero claims on TDY (total_claims: 0, 0 net-bullish voices). No star investor, podcast, or analyst voice we track has an on-record, distilled view on Teledyne.
That is stated plainly and honestly: this verdict is entirely fundamentals- and quant-driven. There is no conviction panel to lean on, and none is fabricated. Where other Synthos names cite a dozen reconciled claim_ids, TDY has none — so the burden falls on the numbers, the valuation model, and management's own guidance (§9), which is explicitly half-weighted because it is self-interested.
The Street, for context (not conviction), is mildly positive: 12 Buy / 4 Hold / 2 Sell, consensus "Buy," but with a price target consensus of $713 that is only ~9% above the current price — a lukewarm setup that is consistent with our Watch.
3. Synthos scores & the Bull / Base / Bear cases
The one-glance judgment — three scores, 0–10, each anchored to real metrics (not probabilities we can't honestly calibrate):
| Score | 0–10 | The read |
|---|---|---|
| Downside Risk (lower = safer) | 4 · Moderate-Low | Beta 0.92, net-debt/EBITDA 1.3× and actively de-levering ($450M maturity paid post-Q1'26), interest coverage 22×, FCF $1.07B. Offsetting: 33× trailing GAAP on ~5% organic growth, and goodwill+intangibles are 69% of assets (M&A model). |
| Growth Quality | 5 · Solid | ~14% forward EPS CAGR (FY25→FY28E), but only ~5% forward revenue CAGR — the EPS gap is buybacks, margin creep and M&A, not organic demand. ROE ~9%, ROIC ~7% (modest for the multiple). Margins slowly rising (non-GAAP op margin 22.6% in Q1'26). |
| Exponential Potential | 3 · Low | A mature $30B compounder in slow-growth industrial/defense end-markets. Growth is decelerating off the FLIR-era bump and acquisition-fed. Steady, not exponential. |
The three cases (our own scenario model — assumptions shown; each target is a ~12–18-month fair value). We deliberately do not attach probabilities: the base case is by definition the expected path, so a weighted blend would just restate it with false precision. Instead the cases bound the range, and the scores above summarize them.
| Case | Key assumptions | Fair value |
|---|---|---|
| Bull | Defense/space and infrared demand accelerate; a sizable accretive acquisition lands; margins push toward 24%. FY27E non-GAAP EPS beats to ~$28 (vs ~$26 cons); multiple re-rates to ~29×. | ~$820 (+26%) |
| Base (our anchor) | Estimates roughly hit — FY26E non-GAAP EPS ~$24, FY27E ~$26; a steady low-double-digit EPS compounder holds a ~26× multiple on FY27E. | ~$660 (+1%) |
| Bear | Defense budget friction + soft industrial/machine-vision demand; M&A pause; organic growth stalls near flat. FY27E EPS misses to ~$24; multiple de-rates to ~21×. | ~$500 (−23%) |
Synthos fair value = the base case, ~$660 (roughly flat, +1%), with the full $500–$820 span as the honest range. This anchor sits below the Street's $713 consensus — we are less willing to pay up for ~5% organic growth. This is a tracked call — the Forecaster Scorecard grades it once it matures.
4. Exponential Potential
Synthos separates compounders (durable high returns on capital) from exponentials (accelerating, multi-baggers-from-here). TDY is a quality compounder with genuinely low exponential potential:
- Forward growth: revenue CAGR FY25→FY28E ~5.0% ($6.12B → ~$7.08B est); EPS CAGR ~14% (GAAP $18.88 → ~$28 est) — the wedge between the two is buybacks, margin expansion and bolt-on M&A, not organic acceleration.
- Acceleration (the 2nd derivative) is roughly flat-to-negative: revenue grew +49% in 2021 (FLIR deal), then +18% (2022), +0.6% (2023), +0.6% (2024), +7.9% (2025, re-accelerated by defense M&A) — then estimates settle back to ~5%/yr. This is a mature cadence, not an inflection.
- Room to run: end-markets (industrial imaging, marine/environmental instruments, defense electronics, space) are large but slow-growing and fragmented; the growth model is buying share, which is capped by deal availability and integration capacity, not by a virgin TAM. At $30B the company is mid-cap, so it could still compound — but not exponentially.
- Reinvestment runway: the real engine is capital allocation — steady FCF (~$1.07B FY25) recycled into acquisitions and buybacks while de-levering. That is a fine compounding story; it is not an exponential one.
Exponential Potential: Low (3/10). Own TDY (if at all) for durable low-double-digit EPS compounding and defensiveness, not for a multibagger. A small, accelerating name with these margins would score higher; a mature $30B serial-acquirer in slow end-markets does not.
5. Financials (real numbers — FMP annual/quarterly + Q1'26 release)
- Revenue: FY25 $6,115.4M, +7.9% (FY24 $5,670.0M, +0.6% on FY23 $5,635.5M). Q1'26 $1,560.1M, +7.6% YoY — of which ~$33M was acquired (organic ~5%).
- Quarterly trajectory: Q1'25 $1,449.9M → Q2 $1,513.7M → Q3 $1,539.5M → Q4 $1,612.3M → Q1'26 $1,560.1M (+7.6% YoY). Steady, seasonal, not accelerating.
- Margins: gross 38.5% TTM, EBITDA 24.6% TTM, GAAP operating ~18.8%, net 15.0% TTM. Non-GAAP operating margin was 22.6% in Q1'26 (up from 22.0%) — slow, real margin creep as FLIR integration matures.
- Earnings: GAAP net income $894.8M FY25 (+9.2% on $819.2M), GAAP EPS $18.88; Q1'26 GAAP EPS $4.85 / non-GAAP $5.80 (+17.2% YoY). Note the large GAAP-vs-non-GAAP gap (~$0.95/qtr) is mostly acquired-intangible amortization — a real feature of the M&A model to keep in view.
- Cash flow: operating CF $1,191.3M FY25, capex only −$117.3M (capex-light, ~2% of revenue), FCF $1,074M (FCF margin ~17.6%). High-quality cash conversion (FCF/OCF 89%).
- Balance sheet: FY25 net debt $2,289.7M; by Q1'26 net debt fell to $1,954.9M, and a $450M debt maturity was paid post-quarter — net-debt/EBITDA ~1.3× and falling. Investment-grade, conservatively financed. Goodwill+intangibles $10.79B (69% of assets) is the flip side of the acquisition model.
6. Valuation — priced in or room?
TDY is not cheap. Trailing: 33× GAAP EPS, ~21× EV/EBITDA, 5.2× EV/sales, 29× P/FCF. On management's own FY26 non-GAAP EPS guide ($23.85–$24.15) the forward P/E is ~27×, easing to ~25× (FY27E) and ~23× (FY28E) if estimates hit — the multiple compresses only slowly because earnings grow only in the low teens and revenue only ~5%. A PEG on trailing earnings is ~2.7×; on a forward basis (FMP) ~4.2× — rich for the organic growth rate.
The bull's defense is that quality serial-acquirers (Danaher, Roper, Ametek) have historically sustained premium multiples because capital allocation keeps compounding EPS above revenue. That is fair — but it is a reason to hold quality, not a reason to pay up at a cycle-rich entry. Street targets (context): consensus $713, high $775, low $614 — our ~$660 base fair value is below consensus because we discount the premium for ~5% organic growth. Not a value buy; a quality-at-a-full-price name best bought on weakness.
7. Technicals (from the tech block)
- Trend: up. $652 sits above the 50-DMA ($628) and 200-DMA ($592), and the 50 is above the 200 (golden-cross posture). MACD +7.4 (positive).
- Location: −5.3% off the 52-week high ($688.59), +34.6% off the 52-week low ($484.47) — mid-to-upper range, modest max drawdown (−5.3% from peak). Not stretched.
- Momentum: RSI(14) 63 — firm but not overbought (<70).
- Relative strength: TDY +27.5% 12-mo vs SPY +20.6% (edges the market), but +5.5% 3-mo vs SPY +13.7% and QQQ +22.0% — it has lagged recently as tech/QQQ ran. Over 6 months TDY (+25.9%) beat SPY (+8.4%) and QQQ (+15.0%).
- Read: a healthy, low-volatility uptrend with no overbought warning — technicals are constructive but not a reason to chase. A pullback toward the rising 50-DMA (~$628) or 200-DMA (~$592) would be a lower-risk entry, consistent with the Watch.
8. Moat & competitive position
Teledyne's moat is portfolio + capital-allocation quality, not a single dominant product. Each niche business holds a defensible position in a small, specialized market (thermal imaging via FLIR, scientific/machine-vision cameras, marine instruments, defense interconnects), with switching costs from design-in and certification, especially in defense and aerospace. The durable edge is the decentralized serial-acquirer engine — a proven ability to buy niche leaders, hold margins, de-lever and repeat, the same model that made Danaher/Roper/Ametek compounders.
The limits: end-markets are mature and cyclical (industrial capex, defense budgets), organic growth is low-single-digit, and returns on invested capital (~7%) are modest for the multiple — the model needs continued smart M&A to justify the premium.
Peer set (market cap, from data): the FMP peer list skews to broad tech-hardware — Coherent $52.9B, Flex $50.1B, Jabil $35.8B, NetApp $30.2B, Fortive $19.1B, HP $20.1B, Broadridge $16.6B, Leidos $13.7B, Trimble $12.4B, VeriSign $23.3B. The truer comparables for TDY's model are quality industrial/instrumentation compounders (Danaher, Roper, Ametek, Fortive) and defense/imaging peers (Leidos, Teledyne's own FLIR heritage) — against those, TDY carries a middle-of-the-pack multiple for middle-of-the-pack growth.
9. Management, capital allocation & guidance
- Capital allocation (the core skill): disciplined M&A + buybacks + de-levering. FY25 spent $821.4M on acquisitions and repurchased $402.9M of stock while cutting net debt; capex is light (~2% of revenue). No dividend — capital is recycled into deals and buybacks. This is the textbook quality-compounder playbook and the main reason to respect the name.
- Insider activity: the sampled Form 4s (filing date 2026-04-24) are routine annual equity awards (options/RSUs at $656.69) to the CEO (George Bobb), Executive Chairman (Robert Mehrabian) and other officers — grants, not open-market discretionary buying or a cluster of alarming sales. Neutral signal.
- Management's own guidance (half-weighted — their self-interested words): the SEC 8-K/Q1'26 earnings release (2026-04-22) is a real earnings release and gives dated forward guidance. Management raised FY2026 outlook: GAAP diluted EPS to $20.08–$20.44 (from $19.76–$20.22) and non-GAAP diluted EPS to $23.85–$24.15 (from $23.45–$23.85). They cited record Q1 sales/non-GAAP EPS/operating margin, strength in Digital Imaging (infrared, space/airborne, unmanned systems) and a return to growth in industrial imaging and X-ray, plus continued de-levering (leverage 1.3×, $450M maturity paid post-quarter). Treat as management's own book, half-weighted — but note it is coherent with the reported numbers and the raise is modest and credible.
10. Catalysts & what to watch
- Next earnings: 2026-07-22 (Q2'26; Street EPS $5.79, revenue ~$1.58B). Watch: organic growth ex-acquisitions, non-GAAP operating margin trend, and any further FY26 guidance revision.
- Defense/space demand: infrared, unmanned systems and defense-electronics order flow — the current growth driver.
- M&A cadence: the model needs deals; a sizable accretive acquisition is the main upside swing (and a stretched deal is a risk).
- Margin trajectory: continued non-GAAP operating-margin creep toward the mid-20s as FLIR integration matures.
- De-levering / buyback mix: with net-debt/EBITDA ~1.3× and falling, watch whether cash tilts to buybacks vs. a new deal.
Thesis tripwires (what would change the call): organic revenue growth stalling toward flat for two quarters; a value-destructive large acquisition; non-GAAP operating margin rolling over; or a de-rate below ~20× FY27E (which would improve the risk/reward and could flip the Watch to a Buy).
11. Key risks
- Valuation / de-rating (the main risk): 33× trailing GAAP on ~5% organic growth — a multiple de-rate, not a business break, is the likeliest way to lose money here.
- Growth is acquisition-dependent: organic growth is low-single-digit; the story relies on continued smart M&A, which carries integration and price-discipline risk.
- Cyclicality: industrial capex and machine-vision/instrumentation demand are cyclical; a downturn pressures the organic line.
- Defense-budget exposure: a meaningful government/defense mix ties part of the business to budget cycles and procurement timing.
- Intangible-heavy balance sheet: goodwill+intangibles are 69% of assets; a soured acquisition could bring impairments. The GAAP-vs-non-GAAP EPS gap (amortization) also flatters the adjusted numbers investors anchor to.
- No expert coverage: unlike higher-conviction Synthos names, there is no external analyst panel in the KB to corroborate or challenge the call — conviction is structurally lower.
12. Verdict, position sizing & monitoring
Watch. Teledyne is a genuinely high-quality, conservatively-financed serial acquirer with strong cash generation (FCF $1.07B, ~18% margin), a de-levering balance sheet, and a proven capital-allocation engine — a company worth owning. But at 33× trailing GAAP EPS on ~5% organic revenue growth, the price already reflects the quality, our base-case fair value (~$660) is essentially flat to spot and below the $713 Street consensus, and there is no expert conviction in the KB to argue for paying up. That combination is a Watch, not a Buy.
- Sizing: if already owned, a 2–4% quality-industrial holding is reasonable; we would not initiate an overweight at this multiple. The disciplined entry is on weakness — toward the 200-DMA (~$592) or a de-rate below ~20× FY27E — which would likely flip this to Buy — Tactical.
- Monitoring: re-underwrite on the §10 tripwires; formal re-score each earnings print (next 2026-07-22). This verdict is logged as a tracked Synthos call as of 2026-07-03 at $652.08.
- Single biggest risk: paying a premium multiple for low-single-digit organic growth — the de-rate risk, not a business failure.
Provenance & disclosures
- Traceability: 0 KB claims, breadth 0 — there is no expert coverage of TDY in the Synthos knowledge base. This note is fundamentals- and quant-driven; no conviction is fabricated (claim-ID reconciliation makes that structurally impossible, and here there are simply no claims to cite).
- Data as-of: fundamentals 2026-03-29 (Q1'26) · estimates & prices 2026-07-02/03 · management guidance from the SEC 8-K earnings release dated 2026-04-22. Forward figures are analyst consensus (FMP) or management guidance, labeled as estimates.
- Management caveat: TDY management's raised FY26 guidance is management's own, self-interested words, half-weighted by design (though coherent with reported results).
- Not investment advice. Independent research, educational and informational only, never personalized. Hypothetical/forward figures are labeled; the only performance numbers Synthos will headline are the live, real-money Flagship's.
- Version: 2026-07-03. Prior versions available via the deep-dive version dropdown ("based on the info at the time").