TEREX CORP (TEX) Stock Fundamental Analysis
NYSE:TEX - New York Stock Exchange, Inc. - US8807791038 - Common Stock - Currency: USD
Overall TEX gets a fundamental rating of 5 out of 10. We evaluated TEX against 128 industry peers in the Machinery industry. TEX has an average financial health and profitability rating. TEX may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
TEX had positive earnings in the past year.
In the past year TEX had a positive cash flow from operations.
TEX had positive earnings in 4 of the past 5 years.
Each year in the past 5 years TEX had a positive operating cash flow.
1.2 Ratios
TEX has a Return On Assets of 2.91%. This is comparable to the rest of the industry: TEX outperforms 45.31% of its industry peers.
TEX has a Return On Equity of 9.11%. This is comparable to the rest of the industry: TEX outperforms 52.34% of its industry peers.
Looking at the Return On Invested Capital, with a value of 6.57%, TEX is in line with its industry, outperforming 48.44% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for TEX is significantly above the industry average of 10.74%.
The last Return On Invested Capital (6.57%) 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 | 2.91% | ||
| ROE | 9.11% | ||
| ROIC | 6.57% |
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 of 3.46%. This is comparable to the rest of the industry: TEX outperforms 42.19% of its industry peers.
TEX's Profit Margin has improved in the last couple of years.
TEX has a Operating Margin (7.22%) which is comparable to the rest of the industry.
TEX's Operating Margin has improved in the last couple of years.
TEX has a Gross Margin of 18.63%. This is in the lower half of the industry: TEX underperforms 74.22% of its industry peers.
TEX's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.22% | ||
| PM (TTM) | 3.46% | ||
| GM | 18.63% |
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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so TEX is creating value.
Compared to 1 year ago, TEX has less shares outstanding
TEX has less shares outstanding than it did 5 years ago.
The debt/assets ratio for TEX is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.23 indicates that TEX is not a great score, but indicates only limited risk for bankruptcy at the moment.
TEX has a Altman-Z score of 2.23. This is in the lower half of the industry: TEX underperforms 64.06% of its industry peers.
TEX has a debt to FCF ratio of 10.96. This is a negative value and a sign of low solvency as TEX would need 10.96 years to pay back of all of its debts.
TEX has a worse Debt to FCF ratio (10.96) than 61.72% of its industry peers.
TEX has a Debt/Equity ratio of 1.31. This is a high value indicating a heavy dependency on external financing.
TEX's Debt to Equity ratio of 1.31 is on the low side compared to the rest of the industry. TEX is outperformed by 82.03% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.31 | ||
| Debt/FCF | 10.96 | ||
| Altman-Z | 2.23 |
ROIC/WACC0.74
WACC8.85%
2.3 Liquidity
TEX has a Current Ratio of 2.08. This indicates that TEX is financially healthy and has no problem in meeting its short term obligations.
With a Current ratio value of 2.08, TEX perfoms like the industry average, outperforming 51.56% of the companies in the same industry.
TEX has a Quick Ratio of 1.11. 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 (1.11) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.08 | ||
| Quick Ratio | 1.11 |
3. Growth
3.1 Past
TEX shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -51.15%.
TEX shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.10% yearly.
The Revenue has decreased by -0.35% in the past year.
TEX shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.33% yearly.
EPS 1Y (TTM)-51.15%
EPS 3Y18.35%
EPS 5Y9.1%
EPS Q2Q%-31.02%
Revenue 1Y (TTM)-0.35%
Revenue growth 3Y9.67%
Revenue growth 5Y3.33%
Sales Q2Q%7.62%
3.2 Future
TEX is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.44% yearly.
Based on estimates for the next years, TEX will show a small growth in Revenue. The Revenue will grow by 4.56% on average per year.
EPS Next Y-5.39%
EPS Next 2Y6.8%
EPS Next 3Y9.86%
EPS Next 5Y7.44%
Revenue Next Year4.01%
Revenue Next 2Y4.17%
Revenue Next 3Y4.44%
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.
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.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 13.49, the valuation of TEX can be described as correct.
83.59% of the companies in the same industry are more expensive than TEX, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of TEX to the average of the S&P500 Index (26.99), we can say TEX is valued rather cheaply.
With a Price/Forward Earnings ratio of 8.45, the valuation of TEX can be described as very reasonable.
TEX's Price/Forward Earnings ratio is rather cheap when compared to the industry. TEX is cheaper than 95.31% of the companies in the same industry.
TEX is valuated cheaply when we compare the Price/Forward Earnings ratio to 36.36, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.49 | ||
| Fwd PE | 8.45 |
4.2 Price Multiples
74.22% of the companies in the same industry are more expensive than TEX, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, TEX is valued cheaply inside the industry as 84.38% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.47 | ||
| EV/EBITDA | 10.73 |
4.3 Compensation for Growth
The decent profitability rating of TEX may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.48
EPS Next 2Y6.8%
EPS Next 3Y9.86%
5. Dividend
5.1 Amount
TEX has a Yearly Dividend Yield of 1.37%.
TEX's Dividend Yield is a higher than the industry average which is at 1.92.
Compared to an average S&P500 Dividend Yield of 2.40, TEX's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.37% |
5.2 History
On average, the dividend of TEX grows each year by 9.24%, which is quite nice.
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
TEX pays out 25.25% of its income as dividend. This is a sustainable payout ratio.
The dividend of TEX is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP25.25%
EPS Next 2Y6.8%
EPS Next 3Y9.86%
48.58
-0.94 (-1.9%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners103.66%
Inst Owner Change0.18%
Ins Owners1.43%
Ins Owner Change5%
Market Cap3.19B
Analysts67.5
Price Target55.42 (14.08%)
Short Float %6.49%
Short Ratio4.78
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.37% |
Yearly Dividend0.7
Dividend Growth(5Y)9.24%
DP25.25%
Div Incr Years4
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)37.22%
Min EPS beat(2)5.41%
Max EPS beat(2)69.03%
EPS beat(4)2
Avg EPS beat(4)-7.65%
Min EPS beat(4)-104.14%
Max EPS beat(4)69.03%
EPS beat(8)6
Avg EPS beat(8)2.76%
EPS beat(12)10
Avg EPS beat(12)12.48%
EPS beat(16)13
Avg EPS beat(16)16.86%
Revenue beat(2)1
Avg Revenue beat(2)0.18%
Min Revenue beat(2)-1.84%
Max Revenue beat(2)2.2%
Revenue beat(4)2
Avg Revenue beat(4)0.86%
Min Revenue beat(4)-1.84%
Max Revenue beat(4)3.24%
Revenue beat(8)4
Avg Revenue beat(8)0.35%
Revenue beat(12)8
Avg Revenue beat(12)2.77%
Revenue beat(16)10
Avg Revenue beat(16)2.23%
PT rev (1m)3.6%
PT rev (3m)21.91%
EPS NQ rev (1m)-4.39%
EPS NQ rev (3m)-4.25%
EPS NY rev (1m)-0.27%
EPS NY rev (3m)8.35%
Revenue NQ rev (1m)0.07%
Revenue NQ rev (3m)-0.41%
Revenue NY rev (1m)-0.09%
Revenue NY rev (3m)0.56%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.49 | ||
| Fwd PE | 8.45 | ||
| P/S | 0.62 | ||
| P/FCF | 13.47 | ||
| P/OCF | 8.51 | ||
| P/B | 1.62 | ||
| P/tB | N/A | ||
| EV/EBITDA | 10.73 |
EPS(TTM)3.6
EY7.41%
EPS(NY)5.75
Fwd EY11.83%
FCF(TTM)3.61
FCFY7.42%
OCF(TTM)5.71
OCFY11.75%
SpS78.8
BVpS29.95
TBVpS-3.12
PEG (NY)N/A
PEG (5Y)1.48
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.91% | ||
| ROE | 9.11% | ||
| ROCE | 7.68% | ||
| ROIC | 6.57% | ||
| ROICexc | 7.12% | ||
| ROICexgc | 13.8% | ||
| OM | 7.22% | ||
| PM (TTM) | 3.46% | ||
| GM | 18.63% | ||
| FCFM | 4.58% |
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 Turnover0.84
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.31 | ||
| Debt/FCF | 10.96 | ||
| Debt/EBITDA | 5.13 | ||
| Cap/Depr | 105.19% | ||
| Cap/Sales | 2.67% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 74.29% | ||
| Profit Quality | 132.18% | ||
| Current Ratio | 2.08 | ||
| Quick Ratio | 1.11 | ||
| Altman-Z | 2.23 |
F-Score4
WACC8.85%
ROIC/WACC0.74
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)-51.15%
EPS 3Y18.35%
EPS 5Y9.1%
EPS Q2Q%-31.02%
EPS Next Y-5.39%
EPS Next 2Y6.8%
EPS Next 3Y9.86%
EPS Next 5Y7.44%
Revenue 1Y (TTM)-0.35%
Revenue growth 3Y9.67%
Revenue growth 5Y3.33%
Sales Q2Q%7.62%
Revenue Next Year4.01%
Revenue Next 2Y4.17%
Revenue Next 3Y4.44%
Revenue Next 5Y4.56%
EBIT growth 1Y-40.82%
EBIT growth 3Y16.31%
EBIT growth 5Y9.35%
EBIT Next Year13.22%
EBIT Next 3Y9.37%
EBIT Next 5Y2.33%
FCF growth 1Y-12.37%
FCF growth 3Y-6.83%
FCF growth 5Y23.99%
OCF growth 1Y0.73%
OCF growth 3Y3.57%
OCF growth 5Y13.46%