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 128 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 decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year TEX was profitable.
In the past year TEX had a positive cash flow from operations.
Of the past 5 years TEX 4 years were profitable.
In the past 5 years TEX always reported a positive cash flow from operatings.
1.2 Ratios
TEX has a Return On Assets of 4.24%. This is comparable to the rest of the industry: TEX outperforms 49.22% of its industry peers.
Looking at the Return On Equity, with a value of 13.43%, TEX is in the better half of the industry, outperforming 66.41% of the companies in the same industry.
TEX has a Return On Invested Capital (7.98%) which is comparable to the rest of the industry.
The Average Return On Invested Capital over the past 3 years for TEX is significantly above the industry average of 10.31%.
The 3 year average ROIC (16.17%) for TEX is well above the current ROIC(7.98%). The reason for the recent decline needs to be investigated.
| 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.
In the last couple of years the Profit Margin of TEX has grown nicely.
TEX has a Operating Margin of 8.63%. This is comparable to the rest of the industry: TEX outperforms 49.22% of its industry peers.
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 72.66% of its industry peers.
TEX's Gross Margin has been stable in the last couple of years.
| 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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TEX is still creating some value.
Compared to 1 year ago, TEX has less shares outstanding
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 2.33. 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.
TEX has a worse Altman-Z score (2.33) than 63.28% of its industry peers.
TEX has a debt to FCF ratio of 12.87. This is a negative value and a sign of low solvency as TEX would need 12.87 years to pay back of all of its debts.
TEX has a Debt to FCF ratio of 12.87. This is in the lower half of the industry: TEX underperforms 62.50% 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.
TEX's Debt to Equity ratio of 1.40 is on the low side compared to the rest of the industry. TEX is outperformed by 80.47% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.4 | ||
| Debt/FCF | 12.87 | ||
| Altman-Z | 2.33 |
ROIC/WACC0.83
WACC9.66%
2.3 Liquidity
TEX has a Current Ratio of 2.11. This indicates that TEX is financially healthy and has no problem in meeting its short term obligations.
TEX has a Current ratio (2.11) which is in line with its industry peers.
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.
TEX has a Quick ratio of 1.07. This is in the lower half of the industry: TEX underperforms 61.72% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.11 | ||
| Quick Ratio | 1.07 |
3. Growth
3.1 Past
The earnings per share for TEX have decreased strongly by -43.44% in the last year.
TEX shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.10% yearly.
TEX shows a decrease in Revenue. In the last year, the revenue decreased by -2.78%.
Measured over the past years, TEX shows a small growth in Revenue. The Revenue has been growing by 3.33% on average per year.
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
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-6.94%
EPS Next 2Y5.57%
EPS Next 3Y9.19%
EPS Next 5Y7.44%
Revenue Next Year3.68%
Revenue Next 2Y3.92%
Revenue Next 3Y4.24%
Revenue Next 5Y4.56%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
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
A Price/Earnings ratio of 10.67 indicates a reasonable valuation of TEX.
TEX's Price/Earnings ratio is rather cheap when compared to the industry. TEX is cheaper than 92.19% of the companies in the same industry.
TEX is valuated cheaply when we compare the Price/Earnings ratio to 26.03, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 8.11, the valuation of TEX can be described as reasonable.
92.97% of the companies in the same industry are more expensive than TEX, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.94, TEX is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.67 | ||
| Fwd PE | 8.11 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TEX indicates a somewhat cheap valuation: TEX is cheaper than 73.44% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, TEX is valued a bit cheaper than 74.22% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.03 | ||
| EV/EBITDA | 10.1 |
4.3 Compensation for Growth
The decent profitability rating of TEX may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.17
EPS Next 2Y5.57%
EPS Next 3Y9.19%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.45%, TEX has a reasonable but not impressive dividend return.
TEX's Dividend Yield is a higher than the industry average which is at 1.83.
TEX's Dividend Yield is slightly below the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.45% |
5.2 History
On average, the dividend of TEX grows each year by 9.24%, which is quite nice.
TEX has been paying a dividend for at least 10 years, so it has 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 18.41% 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.
DP18.41%
EPS Next 2Y5.57%
EPS Next 3Y9.19%
45.57
-2.66 (-5.52%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners99.28%
Inst Owner Change1.5%
Ins Owners1.15%
Ins Owner Change3.62%
Market Cap3.02B
Analysts53
Price Target43.81 (-3.86%)
Short Float %7.66%
Short Ratio4.22
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.45% |
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)-13.58%
PT rev (3m)-20.17%
EPS NQ rev (1m)3.35%
EPS NQ rev (3m)-4.35%
EPS NY rev (1m)6.57%
EPS NY rev (3m)-4.73%
Revenue NQ rev (1m)0.21%
Revenue NQ rev (3m)-0.95%
Revenue NY rev (1m)-1.11%
Revenue NY rev (3m)-1.54%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.67 | ||
| Fwd PE | 8.11 | ||
| P/S | 0.6 | ||
| P/FCF | 15.03 | ||
| P/OCF | 8.91 | ||
| P/B | 1.64 | ||
| P/tB | N/A | ||
| EV/EBITDA | 10.1 |
EPS(TTM)4.27
EY9.37%
EPS(NY)5.62
Fwd EY12.33%
FCF(TTM)3.03
FCFY6.65%
OCF(TTM)5.11
OCFY11.22%
SpS76.4
BVpS27.82
TBVpS-4.98
PEG (NY)N/A
PEG (5Y)1.17
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 | 2.33 |
F-Score4
WACC9.66%
ROIC/WACC0.83
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-6.94%
EPS Next 2Y5.57%
EPS Next 3Y9.19%
EPS Next 5Y7.44%
Revenue 1Y (TTM)-2.78%
Revenue growth 3Y9.67%
Revenue growth 5Y3.33%
Sales Q2Q%-4.91%
Revenue Next Year3.68%
Revenue Next 2Y3.92%
Revenue Next 3Y4.24%
Revenue Next 5Y4.56%
EBIT growth 1Y-32.45%
EBIT growth 3Y16.31%
EBIT growth 5Y9.35%
EBIT Next Year13.18%
EBIT Next 3Y10.13%
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%