TEREX CORP (TEX) Stock Fundamental Analysis
NYSE:TEX - New York Stock Exchange, Inc. - US8807791038 - Common Stock - Currency: USD
TEX gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 127 industry peers in the Machinery industry. There are concerns on the financial health of TEX while its profitability can be described as average. TEX has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
TEX had positive earnings in the past year.
TEX had a positive operating cash flow in the past year.
Of the past 5 years TEX 4 years were profitable.
Each year in the past 5 years TEX had a positive operating cash flow.
1.2 Ratios
TEX has a Return On Assets (4.24%) which is in line with its industry peers.
TEX's Return On Equity of 13.43% is fine compared to the rest of the industry. TEX outperforms 65.35% of its industry peers.
TEX has a Return On Invested Capital (7.98%) which is comparable to the rest of the industry.
TEX had an Average Return On Invested Capital over the past 3 years of 16.17%. This is significantly above the industry average of 10.78%.
The last Return On Invested Capital (7.98%) for TEX is well below the 3 year average (16.17%), which needs to be investigated, but indicates that TEX had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.24% | ||
| ROE | 13.43% | ||
| ROIC | 7.98% |
ROA(3y)9.93%
ROA(5y)7.43%
ROE(3y)24.89%
ROE(5y)18.68%
ROIC(3y)16.17%
ROIC(5y)13.18%
1.3 Margins
TEX has a Profit Margin (4.89%) which is comparable to the rest of the industry.
TEX's Profit Margin has improved in the last couple of years.
With a Operating Margin value of 8.63%, TEX perfoms like the industry average, outperforming 48.82% of the companies in the same industry.
TEX's Operating Margin has improved in the last couple of years.
TEX's Gross Margin of 19.76% is on the low side compared to the rest of the industry. TEX is outperformed by 73.23% of its industry peers.
In the last couple of years the Gross Margin of TEX has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.63% | ||
| PM (TTM) | 4.89% | ||
| GM | 19.76% |
OM growth 3Y6.05%
OM growth 5Y5.82%
PM growth 3Y4.76%
PM growth 5Y39.21%
GM growth 3Y2.25%
GM growth 5Y0.42%
2. Health
2.1 Basic Checks
TEX has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
TEX has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, TEX has less shares outstanding
The debt/assets ratio for TEX is higher compared to a year ago.
2.2 Solvency
TEX has an Altman-Z score of 2.35. This is not the best score and indicates that TEX is in the grey zone with still only limited risk for bankruptcy at the moment.
The Altman-Z score of TEX (2.35) is worse than 62.99% of its industry peers.
The Debt to FCF ratio of TEX is 12.87, which is on the high side as it means it would take TEX, 12.87 years of fcf income to pay off all of its debts.
TEX has a worse Debt to FCF ratio (12.87) than 65.35% of its industry peers.
A Debt/Equity ratio of 1.40 is on the high side and indicates that TEX has dependencies on debt financing.
The Debt to Equity ratio of TEX (1.40) is worse than 82.68% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.4 | ||
| Debt/FCF | 12.87 | ||
| Altman-Z | 2.35 |
ROIC/WACC0.87
WACC9.13%
2.3 Liquidity
A Current Ratio of 2.11 indicates that TEX has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 2.11, TEX is in line with its industry, outperforming 53.54% of the companies in the same industry.
TEX has a Quick Ratio of 1.07. This is a normal value and indicates that TEX is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of TEX (1.07) is worse than 60.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.11 | ||
| Quick Ratio | 1.07 |
3. Growth
3.1 Past
TEX shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -43.44%.
The Earnings Per Share has been growing by 9.10% on average over the past years. This is quite good.
The Revenue has decreased by -2.78% in the past year.
The Revenue has been growing slightly by 3.33% on average over the past years.
EPS 1Y (TTM)-43.44%
EPS 3Y18.35%
EPS 5Y9.1%
EPS Q2Q%-48.13%
Revenue 1Y (TTM)-2.78%
Revenue growth 3Y9.67%
Revenue growth 5Y3.33%
Sales Q2Q%-4.91%
3.2 Future
The Earnings Per Share is expected to grow by 7.44% on average over the next years.
The Revenue is expected to grow by 4.56% on average over the next years.
EPS Next Y-5.39%
EPS Next 2Y6.8%
EPS Next 3Y9.86%
EPS Next 5Y7.44%
Revenue Next Year4.12%
Revenue Next 2Y4.36%
Revenue Next 3Y4.51%
Revenue Next 5Y4.56%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 11.69, which indicates a very decent valuation of TEX.
Based on the Price/Earnings ratio, TEX is valued cheaper than 89.76% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.19. TEX is valued rather cheaply when compared to this.
Based on the Price/Forward Earnings ratio of 8.68, the valuation of TEX can be described as reasonable.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TEX indicates a rather cheap valuation: TEX is cheaper than 96.85% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 35.33, TEX is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.69 | ||
| Fwd PE | 8.68 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TEX is valued a bit cheaper than the industry average as 73.23% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of TEX indicates a somewhat cheap valuation: TEX is cheaper than 73.23% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.29 | ||
| EV/EBITDA | 10.36 |
4.3 Compensation for Growth
The decent profitability rating of TEX may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.28
EPS Next 2Y6.8%
EPS Next 3Y9.86%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.27%, TEX has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 1.82, TEX pays a bit more dividend than its industry peers.
With a Dividend Yield of 1.27, TEX pays less dividend than the S&P500 average, which is at 2.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.27% |
5.2 History
The dividend of TEX is nicely growing with an annual growth rate of 9.24%!
TEX has paid a dividend for at least 10 years, which is a reliable track record.
TEX has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)9.24%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
18.41% of the earnings are spent on dividend by TEX. This is a low number and sustainable payout ratio.
TEX's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP18.41%
EPS Next 2Y6.8%
EPS Next 3Y9.86%
49.9
-1.04 (-2.04%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners103.66%
Inst Owner Change0%
Ins Owners1.43%
Ins Owner Change5%
Market Cap3.27B
Analysts68.24
Price Target50.95 (2.1%)
Short Float %6.79%
Short Ratio4.53
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.27% |
Yearly Dividend0.7
Dividend Growth(5Y)9.24%
DP18.41%
Div Incr Years4
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-17.55%
Min EPS beat(2)-104.14%
Max EPS beat(2)69.03%
EPS beat(4)2
Avg EPS beat(4)-8.04%
Min EPS beat(4)-104.14%
Max EPS beat(4)69.03%
EPS beat(8)6
Avg EPS beat(8)7%
EPS beat(12)10
Avg EPS beat(12)13.91%
EPS beat(16)13
Avg EPS beat(16)20.87%
Revenue beat(2)0
Avg Revenue beat(2)-1%
Min Revenue beat(2)-1.84%
Max Revenue beat(2)-0.16%
Revenue beat(4)1
Avg Revenue beat(4)-0.72%
Min Revenue beat(4)-4.12%
Max Revenue beat(4)3.24%
Revenue beat(8)4
Avg Revenue beat(8)1.27%
Revenue beat(12)7
Avg Revenue beat(12)2.5%
Revenue beat(16)10
Avg Revenue beat(16)2.15%
PT rev (1m)0%
PT rev (3m)0.5%
EPS NQ rev (1m)-4.42%
EPS NQ rev (3m)-1.81%
EPS NY rev (1m)1.67%
EPS NY rev (3m)-1.8%
Revenue NQ rev (1m)-0.96%
Revenue NQ rev (3m)-0.75%
Revenue NY rev (1m)0.19%
Revenue NY rev (3m)-0.68%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.69 | ||
| Fwd PE | 8.68 | ||
| P/S | 0.65 | ||
| P/FCF | 16.29 | ||
| P/OCF | 9.66 | ||
| P/B | 1.78 | ||
| P/tB | N/A | ||
| EV/EBITDA | 10.36 |
EPS(TTM)4.27
EY8.56%
EPS(NY)5.75
Fwd EY11.52%
FCF(TTM)3.06
FCFY6.14%
OCF(TTM)5.17
OCFY10.35%
SpS77.19
BVpS28.11
TBVpS-5.03
PEG (NY)N/A
PEG (5Y)1.28
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.24% | ||
| ROE | 13.43% | ||
| ROCE | 9.33% | ||
| ROIC | 7.98% | ||
| ROICexc | 8.53% | ||
| ROICexgc | 16.9% | ||
| OM | 8.63% | ||
| PM (TTM) | 4.89% | ||
| GM | 19.76% | ||
| FCFM | 3.97% |
ROA(3y)9.93%
ROA(5y)7.43%
ROE(3y)24.89%
ROE(5y)18.68%
ROIC(3y)16.17%
ROIC(5y)13.18%
ROICexc(3y)18.69%
ROICexc(5y)15.38%
ROICexgc(3y)25.21%
ROICexgc(5y)20.16%
ROCE(3y)18.89%
ROCE(5y)15.4%
ROICexcg growth 3Y1.95%
ROICexcg growth 5Y2.65%
ROICexc growth 3Y-14.65%
ROICexc growth 5Y-8.12%
OM growth 3Y6.05%
OM growth 5Y5.82%
PM growth 3Y4.76%
PM growth 5Y39.21%
GM growth 3Y2.25%
GM growth 5Y0.42%
F-Score4
Asset Turnover0.87
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.4 | ||
| Debt/FCF | 12.87 | ||
| Debt/EBITDA | 4.75 | ||
| Cap/Depr | 130.07% | ||
| Cap/Sales | 2.73% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 62.39% | ||
| Profit Quality | 81.11% | ||
| Current Ratio | 2.11 | ||
| Quick Ratio | 1.07 | ||
| Altman-Z | 2.35 |
F-Score4
WACC9.13%
ROIC/WACC0.87
Cap/Depr(3y)208.27%
Cap/Depr(5y)174.7%
Cap/Sales(3y)2.54%
Cap/Sales(5y)2.25%
Profit Quality(3y)57.02%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-43.44%
EPS 3Y18.35%
EPS 5Y9.1%
EPS Q2Q%-48.13%
EPS Next Y-5.39%
EPS Next 2Y6.8%
EPS Next 3Y9.86%
EPS Next 5Y7.44%
Revenue 1Y (TTM)-2.78%
Revenue growth 3Y9.67%
Revenue growth 5Y3.33%
Sales Q2Q%-4.91%
Revenue Next Year4.12%
Revenue Next 2Y4.36%
Revenue Next 3Y4.51%
Revenue Next 5Y4.56%
EBIT growth 1Y-32.45%
EBIT growth 3Y16.31%
EBIT growth 5Y9.35%
EBIT Next Year14.5%
EBIT Next 3Y9.87%
EBIT Next 5Y2.33%
FCF growth 1Y-5.33%
FCF growth 3Y-6.83%
FCF growth 5Y23.99%
OCF growth 1Y5.25%
OCF growth 3Y3.57%
OCF growth 5Y13.46%