Is Terex a Good Value Stock to Own?

NYSE: TEX | Terex Corporation  News, Ratings, and Charts

TEX – Despite robust performance in its last reported quarter, Terex’s (TEX) shares are down 20.1% in price year-to-date as the company struggles with supply chain disruptions and rising costs. However, given that it looks undervalued at its current price level, would it be worth betting on the stock now? Read on to learn our view.

Terex Corporation (TEX) in Westport, Conn., is a multinational manufacturer of materials processing gear and aerial work platforms. It creates, manufactures, and supports products used in construction, maintenance, manufacturing, energy, recycling, minerals, and materials management. The stock has gained 3.4% in price over the past month.

In terms of forward Non-GAAP P/E, the stock is currently trading at 9.26x, which is 43.1% lower than the 16.26x industry average. Also, its 0.70x forward EV/Sales is 56.8% lower than the 1.62x industry average. Furthermore, TEX’s 0.57x forward Price/Sales is 55.3% lower than the 1.28x industry average.

However, the company’s shares are down 35.1% in price over the past year and 20.1% year-to-date to close yesterday’s trading session at $35.14. While TEX is well-positioned for growth due to strong consumer demand, global supply chain disruptions and significant inflationary pressures due to the pandemic and geopolitical uncertainties are weighing on its operational performance.

Here is what could shape TEX’s performance in the near term:

Mixed Profitability

TEX’s 1.36% trailing-12-month asset turnover ratio is 70.3% higher than the 0.8% industry average. Its trailing-12-month ROA and ROC are 46.3% and 56.4% higher than their respective industry averages. However, its 5.8% trailing-12-month net income margin is 14.5% lower than its 6.8% industry average. Also, its 19.1% trailing-12-month gross profit margin is 35.5% lower than the 29.6% industry average.

Consensus Rating and Price Target Indicate Potential Upside

Among 11 Wall Street analysts that rated TEX, seven rated it Buy, and four rated it Hold. The 12-month median price target of $51.18 indicates a 45.7% potential upside. The price targets range from a low of $38.00 to a high of $64.00.

POWR Ratings Reflect Uncertainty

TEX has an overall C rating, which equates to a Neutral in our proprietary POWR Ratings system. The POWR ratings are calculated by considering 118 distinct factors, with each factor weighted to an optimal degree.

Our proprietary rating system also evaluates each stock based on eight distinct categories. TEX has a C grade for Stability and Quality. Its stock’s 1.52 beta is in sync with the Stability grade. In addition, the company’s mixed profitability is consistent with the Quality grade.

Among the 46 stocks in the A-rated Industrial – Building Materials industry, TEX is ranked #27.

Beyond what I have stated above, one can view TEX ratings for Growth, Value, Momentum, and Sentiment here.

Click here to check out our Industrial Sector Report for 2022

Bottom Line

TEX stock is down nearly 20% in price year-to-date despite the company posting solid earnings results in its last reported quarter. While the company’s strategic growth plans, investment in innovative products, and digital innovation will fuel its growth, persistent supply chain, labor, and logistical issues, and high costs may jeopardize its near-term prospects. So, we think investors should wait before scooping up its shares.

How Does Terex Corporation (TEX) Stack Up Against its Peers?

While TEX has an overall C rating, one might want to consider its industry peer, Huttig Building Products Inc. (HBP) and Owens Corning Inc New (OC), which has an overall A (Strong Buy) rating.

What To Do Next?

If you would like to see more top value stocks, then you should check out our free special report:

7 SEVERELY Undervalued Stocks

What makes these stocks great additions to any portfolio?

First, because they are all undervalued companies with exciting upside potential.

But even more important, is that they are all top Buy rated stocks according to our coveted POWR Ratings system. Yes, that same system where top-rated stocks have averaged a +37.99% annual return.

Click below now to see these 7 stellar value stocks with the right stuff to outperform in the coming months.

7 SEVERELY Undervalued Stocks


TEX shares were unchanged in premarket trading Thursday. Year-to-date, TEX has declined -19.75%, versus a -13.21% rise in the benchmark S&P 500 index during the same period.


About the Author: Pragya Pandey


Pragya is an equity research analyst and financial journalist with a passion for investing. In college she majored in finance and is currently pursuing the CFA program and is a Level II candidate. More...


More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
TEXGet RatingGet RatingGet Rating
HBPGet RatingGet RatingGet Rating
OCGet RatingGet RatingGet Rating

Most Popular Stories on StockNews.com


:  |  News, Ratings, and Charts

Recession or Not Recession…That Is the Question

Every investor appreciates that recessions and bear markets go hand in hand. But the definition of a recession often seems more difficult to pin down. So are we in a recession? And if not, then does that mean that disaster has been averted or that the pain train is still rolling towards investors? This is an important debate because it helps us appreciate what lies ahead for the stock market (SPY). We will tackle this vital topic in this week's commentary. Read on below...

:  |  News, Ratings, and Charts

3 Cybersecurity Stocks to Buy on the Pullback

Tech stocks are rallying. Within the sector, cybersecurity stocks offer the best combination of growth and value especially as the sector's importance grows everyday. Read on to find out why investors should consider buying top cybersecurity stocks like Fortinet (FTNT), Qualys (QLYS), and OneSpan (OSPN).

:  |  News, Ratings, and Charts

4 Big Reasons Why the Bear Rally Is Nearing an End…

The Stock Market (SPY) has put on an impressive rally over the last few weeks, leading many investors to believe that the bull is ready to resume its run. However, there are multiple reasons to believe the bear market is far from over. I lay out 4 of the main reasons below and explain how you can profit from the volatile markets that lie ahead. Read on below for more…

:  |  News, Ratings, and Charts

Is Costco Stock Still a Buy Amid Retail Troubles?

Retail companies have faced significant headwinds this year due to sky-high inflation and supply chain disruptions. However, Costco Wholesale's (COST) strong revenue performance and consistent margins have helped the stock to remain resilient amid retail troubles. So is this stock worth adding to your portfolio now? Let’s find out…

:  |  News, Ratings, and Charts

4 Big Reasons Why the Bear Rally Is Nearing an End…

The Stock Market (SPY) has put on an impressive rally over the last few weeks, leading many investors to believe that the bull is ready to resume its run. However, there are multiple reasons to believe the bear market is far from over. I lay out 4 of the main reasons below and explain how you can profit from the volatile markets that lie ahead. Read on below for more…

Read More Stories

More Terex Corporation (TEX) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All TEX News