For those who appreciate value investing, NYSE:TEX is a compelling option with its solid fundamentals.

Last update: Sep 25, 2023

Our stock screener has singled out TEREX CORP (NYSE:TEX) as a stellar value proposition. NYSE:TEX not only scores well in profitability, solvency, and liquidity but also maintains a very reasonable price point. We'll explore this further.

How do we evaluate the Valuation for NYSE:TEX?

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NYSE:TEX has received a 9 out of 10:

Based on the Price/Earnings ratio of 8.72, the valuation of TEX can be described as reasonable.
Compared to the rest of the industry, the Price/Earnings ratio of TEX indicates a rather cheap valuation: TEX is cheaper than 94.57% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of TEX to the average of the S&P500 Index (25.89), we can say TEX is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 7.85, the valuation of TEX can be described as very cheap.
Based on the Price/Forward Earnings ratio, TEX is valued cheaper than 93.80% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of TEX to the average of the S&P500 Index (18.97), we can say TEX is valued rather cheaply.
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TEX indicates a rather cheap valuation: TEX is cheaper than 88.37% of the companies listed in the same industry.
TEX's Price/Free Cash Flow ratio is rather cheap when compared to the industry. TEX is cheaper than 84.50% of the companies in the same industry.
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of TEX may justify a higher PE ratio.
TEX's earnings are expected to grow with 18.38% in the coming years. This may justify a more expensive valuation.

Analyzing Profitability Metrics

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NYSE:TEX scores a 7 out of 10:

The Return On Assets of TEX (13.06%) is better than 91.47% of its industry peers.
Looking at the Return On Equity, with a value of 31.14%, TEX belongs to the top of the industry, outperforming 93.80% of the companies in the same industry.
With an excellent Return On Invested Capital value of 21.03%, TEX belongs to the best of the industry, outperforming 94.57% of the companies in the same industry.
The 3 year average ROIC (11.01%) for TEX is below the current ROIC(21.03%), indicating increased profibility in the last year.
TEX has a Profit Margin of 8.96%. This is in the better half of the industry: TEX outperforms 72.09% of its industry peers.
In the last couple of years the Profit Margin of TEX has grown nicely.
The Operating Margin of TEX (12.04%) is better than 69.77% of its industry peers.
In the last couple of years the Operating Margin of TEX has grown nicely.

Understanding NYSE:TEX's Health Score

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:TEX has received a 6 out of 10:

An Altman-Z score of 4.19 indicates that TEX is not in any danger for bankruptcy at the moment.
TEX has a better Altman-Z score (4.19) than 75.97% of its industry peers.
The Debt to FCF ratio of TEX is 2.73, which is a good value as it means it would take TEX, 2.73 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of TEX (2.73) is better than 75.97% of its industry peers.
TEX has a Current Ratio of 2.07. This indicates that TEX is financially healthy and has no problem in meeting its short term obligations.

Unpacking NYSE:TEX's Growth Rating

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NYSE:TEX was assigned a score of 6 for growth:

The Earnings Per Share has grown by an impressive 97.58% over the past year.
The Earnings Per Share has been growing by 25.63% on average over the past years. This is a very strong growth
The Revenue has grown by 22.48% in the past year. This is a very strong growth!
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.

Every day, new Decent Value stocks can be found on ChartMill 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.