When you look at NYSE:TEX, it's hard to ignore the strong fundamentals, especially considering its likely undervaluation.

Last update: Feb 27, 2024

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.

Valuation Analysis 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:

A Price/Earnings ratio of 7.13 indicates a rather cheap valuation of TEX.
Compared to the rest of the industry, the Price/Earnings ratio of TEX indicates a rather cheap valuation: TEX is cheaper than 96.18% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of TEX to the average of the S&P500 Index (25.81), we can say TEX is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 7.57, the valuation of TEX can be described as very cheap.
TEX's Price/Forward Earnings ratio is rather cheap when compared to the industry. TEX is cheaper than 96.95% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of TEX to the average of the S&P500 Index (21.49), we can say TEX is valued rather cheaply.
Based on the Enterprise Value to EBITDA ratio, TEX is valued cheaper than 91.60% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of TEX indicates a rather cheap valuation: TEX is cheaper than 88.55% of the companies listed in the same industry.
The excellent profitability rating of TEX may justify a higher PE ratio.

Profitability Assessment of NYSE:TEX

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 8 out of 10:

TEX has a better Return On Assets (14.33%) than 94.66% of its industry peers.
Looking at the Return On Equity, with a value of 30.98%, TEX belongs to the top of the industry, outperforming 92.37% of the companies in the same industry.
TEX's Return On Invested Capital of 21.80% is amongst the best of the industry. TEX outperforms 93.89% of its industry peers.
The Average Return On Invested Capital over the past 3 years for TEX is significantly above the industry average of 10.63%.
The 3 year average ROIC (17.81%) for TEX is below the current ROIC(21.80%), indicating increased profibility in the last year.
With a decent Profit Margin value of 10.06%, TEX is doing good in the industry, outperforming 75.57% of the companies in the same industry.
TEX's Profit Margin has improved in the last couple of years.
With a decent Operating Margin value of 12.36%, TEX is doing good in the industry, outperforming 66.41% of the companies in the same industry.
In the last couple of years the Operating Margin of TEX has grown nicely.

What does the Health looks like for NYSE:TEX

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NYSE:TEX scores a 8 out of 10:

TEX has an Altman-Z score of 4.15. This indicates that TEX is financially healthy and has little risk of bankruptcy at the moment.
TEX has a Altman-Z score of 4.15. This is in the better half of the industry: TEX outperforms 74.05% of its industry peers.
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.
TEX has a better Debt to FCF ratio (1.88) than 80.92% of its industry peers.
A Debt/Equity ratio of 0.37 indicates that TEX is not too dependend on debt financing.
TEX has a Current Ratio of 2.01. This indicates that TEX is financially healthy and has no problem in meeting 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.

Analyzing Growth Metrics

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. NYSE:TEX has received a 5 out of 10:

TEX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 74.48%, which is quite impressive.
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.
The Revenue has grown by 16.61% in the past year. This is quite good.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

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

Our latest full fundamental report of TEX contains the most current fundamental analsysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.