NYSE:TEX: good value for what you're paying.

Our stock screening tool has identified TEREX CORP (NYSE:TEX) as an undervalued gem with strong fundamentals. NYSE:TEX boasts decent financial health and profitability while maintaining an attractive price point. We'll break it down further.

Assessing Valuation Metrics for NYSE:TEX

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NYSE:TEX was assigned a score of 8 for valuation:

• The Price/Earnings ratio is 7.38, which indicates a rather cheap valuation of TEX.
• TEX's Price/Earnings ratio is rather cheap when compared to the industry. TEX is cheaper than 93.02% of the companies in the same industry.
• TEX's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 24.67.
• TEX is valuated cheaply with a Price/Forward Earnings ratio of 7.95.
• Compared to the rest of the industry, the Price/Forward Earnings ratio of TEX indicates a rather cheap valuation: TEX is cheaper than 93.80% of the companies listed in the same industry.
• Compared to an average S&P500 Price/Forward Earnings ratio of 21.02, TEX is valued rather cheaply.
• 91.47% of the companies in the same industry are more expensive than TEX, based on the Enterprise Value to EBITDA ratio.
• TEX's Price/Free Cash Flow ratio is rather cheap when compared to the industry. TEX is cheaper than 89.15% of the companies in the same industry.
• TEX has an outstanding profitability rating, which may justify a higher PE ratio.

Profitability Examination for NYSE:TEX

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:TEX, the assigned 8 is noteworthy for profitability:

• TEX has a better Return On Assets (14.33%) than 92.25% of its industry peers.
• TEX has a Return On Equity of 30.98%. This is amongst the best in the industry. TEX outperforms 91.47% of its industry peers.
• The Return On Invested Capital of TEX (21.80%) is better than 95.35% of its industry peers.
• TEX had an Average Return On Invested Capital over the past 3 years of 17.81%. This is significantly above the industry average of 10.76%.
• The last Return On Invested Capital (21.80%) for TEX is above the 3 year average (17.81%), which is a sign of increasing profitability.
• TEX has a better Profit Margin (10.06%) than 75.19% of its industry peers.
• In the last couple of years the Profit Margin of TEX has grown nicely.
• Looking at the Operating Margin, with a value of 12.36%, TEX is in the better half of the industry, outperforming 65.89% of the companies in the same industry.
• TEX's Operating Margin has improved in the last couple of years.

A Closer Look at Health for NYSE:TEX

ChartMill utilizes a Health Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of liquidity and solvency ratios, both in absolute terms and in comparison to industry peers. NYSE:TEX has earned a 8 out of 10:

• An Altman-Z score of 4.25 indicates that TEX is not in any danger for bankruptcy at the moment.
• Looking at the Altman-Z score, with a value of 4.25, TEX is in the better half of the industry, outperforming 70.54% of the companies in the same industry.
• The Debt to FCF ratio of TEX is 1.88, which is an excellent value as it means it would take TEX, only 1.88 years of fcf income to pay off all of its debts.
• With a decent Debt to FCF ratio value of 1.88, TEX is doing good in the industry, outperforming 79.84% of the companies in the same industry.
• TEX has a Debt/Equity ratio of 0.37. This is a healthy value indicating a solid balance between debt and equity.
• A Current Ratio of 2.01 indicates that TEX has no problem at all paying its short term obligations.
• TEX does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

Deciphering NYSE:TEX's Growth Rating

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NYSE:TEX boasts a 5 out of 10:

• The Earnings Per Share has grown by an impressive 74.48% over the past year.
• Measured over the past years, TEX shows a very strong growth in Earnings Per Share. The EPS has been growing by 22.78% on average per year.
• Looking at the last year, TEX shows a quite strong growth in Revenue. The Revenue has grown by 16.61% in the last year.
• When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

More Decent Value stocks can be found in our Decent Value screener.

For an up to date full fundamental analysis you can check the fundamental report of TEX

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.