Terex Corporation (NYSE:TEX), is not the largest company out there, but it led the NYSE gainers with a relatively large price hike in the past couple of weeks. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Let’s take a look at Terex’s outlook and value based on the most recent financial data to see if the opportunity still exists.
What Is Terex Worth?
Good news, investors! Terex is still a bargain right now. According to my valuation, the intrinsic value for the stock is $87.16, but it is currently trading at US$62.88 on the share market, meaning that there is still an opportunity to buy now. However, given that Terex’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.
What does the future of Terex look like?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. However, with a relatively muted profit growth of 1.1% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Terex, at least in the short term.
What This Means For You
Are you a shareholder? Even though growth is relatively muted, since TEX is currently undervalued, it may be a great time to increase your holdings in the stock. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on TEX for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy TEX. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed investment decision.
In light of this, if you’d like to do more analysis on the company, it’s vital to be informed of the risks involved. At Simply Wall St, we found 1 warning sign for Terex and we think they deserve your attention.
If you are no longer interested in Terex, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
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Find out whether Terex is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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