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Terex (TEX) Q2 Earnings Beat Estimates, Raises FY22 View

·3 min read

Terex Corporation TEX reported second-quarter 2022 adjusted earnings per share of $1.07, which beat the Zacks Consensus Estimate of 87 cents. The bottom line improved 5% from the prior-year quarter, courtesy of strong demand and order growth.

Operational Update

Revenues in the reported quarter increased 3.7% year over year to $1,077 million, surpassing the Zacks Consensus Estimate of $1,070 million. The company reported a backlog of $3.5 billion, which marked a 51% rise over last year's levels.

Cost of goods sold increased 7% year over year to $864 million. Gross profit declined 8% year over year to $213 million.

Terex Corporation Price, Consensus and EPS Surprise

Terex Corporation Price, Consensus and EPS Surprise
Terex Corporation Price, Consensus and EPS Surprise

Terex Corporation price-consensus-eps-surprise-chart | Terex Corporation Quote

Selling, general and administrative expenses (SG&A) were $1094 million in the quarter under review, flat compared with the prior-year quarter. Terex reported an operating profit of $104 million, which marked a decline of 15% from $122.5 million in the last-year quarter.

Segment Performances

The Aerial Work Platforms segment generated revenues of $481 million in the reported quarter, up 9% from the year-ago quarter. The segment reported an operating profit of $79.5 million compared with the prior-year quarter’s $72.1 million.

The Material Processing segment’s revenues totaled $598 million, reflecting year-over-year growth of 0.4%. The segment reported an operating income of $46.2 million, down 29% year over year.

Financial Position

Terex had cash and cash equivalents of $253 million as of Jun 30, 2022, compared with $266 million as of Dec 31, 2021. The company generated $19 million of cash from operating activities in the first six months of 2022 compared with $269 million in the prior-year comparable period. Long-term debt was $826 million as of Jun 30, 2022, compared with $668.5 million as of Dec 31, 2021.

Guidance

Backed by its performance so far this year, Terex raised guidance for 2022 earnings per share to the range of $3.80 to $4.20, from the prior expectation of $3.55-$4.05. The company now expects sales in the range of $4.1 billion to $4.3 billion for the year.

Price Performance

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

Terex's shares have slumped 30% over the past year, compared with the industry’s decline of 11.9%.

Zacks Rank and Stocks to Consider

Terex currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the Industrial Products sector are Greif Inc. GEF, Titan International TWI and MRC Global MRC. All of these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Greif has an estimated earnings growth rate of 37% for the current year. In the past 60 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 17%.

Greif pulled off a trailing four-quarter earnings surprise of 22.9%, on average. GEF’s shares have risen 15% in the past year.

Titan International has an estimated earnings growth rate of 165% for the current year. In the past 60 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 43%.

Titan International pulled off a trailing four-quarter earnings surprise of 56.4%, on average. TWI’s shares have soared 83% in a year.

MRC Global has an expected earnings growth rate of 259% for 2022. The Zacks Consensus Estimate for the current year’s earnings has moved up 24% in the past 60 days.

MRC Global has a trailing four-quarter earnings surprise of 140.8%, on average. MRC’s shares have surged 41% in the past year.


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