TEX: Share Price Is Expected To Revisit Previous Highs After Earnings Shift

Analysts have increased their price target for Terex from $56.82 to $59.70. They cite improved earnings potential and favorable sector trends despite ongoing industry headwinds.

Analyst Commentary

Recent analyst reports offer a variety of perspectives on Terex, with notable optimism about future growth prospects, but also caution regarding potential risks. The following highlights summarize the main points of discussion among industry experts.

• Bullish analysts see meaningful upside for Terex's share price, citing upward adjustments to price targets and the possibility of revisiting previous highs given favorable sector positioning.
• The company's improved business mix and lower earnings volatility have increased confidence in its ability to achieve a higher midcycle earnings valuation.
• An upward bias in earnings estimates is seen as a driver for further valuation multiple expansion across the machinery sector, with Terex considered among the industry’s top picks.
• Although analysts are not forecasting imminent catalysts from upcoming earnings, some believe the current market is already discounting any temporary earnings trough, which indicates that longer-term potential remains intact.

• Bearish analysts highlight risks related to mergers and acquisitions, including concerns about deal structure, timing, and potential dilution, which may limit added value for shareholders in the near term.
• There are lingering questions about the valuation of the combined aerials business. This uncertainty could weigh on share performance if not addressed.
• Tariffs on steel, aluminum, and specific components are impacting the entire industry, including Terex, by increasing costs and creating headwinds for near-term profitability.
• Elevated sector risks, such as those affecting other heavy equipment manufacturers, are expected to challenge execution and could impact earnings consistency moving forward.

What's in the News

• Morgan Stanley sees "good strategic value" in the merger between REV Group and Terex, but warns that deal timing, structure, and possible dilution could add risk and weigh on share performance (Periodical).
• Terex maintained its earnings guidance for full year 2025, expecting net sales between $5,300 million and $5,500 million and EPS of $4.70 to $5.10, assuming tariffs remain at current levels (Key Development).
• The company expects higher tariff-related costs in the fourth quarter as a result of expanded steel and aluminum tariffs announced in mid-August, estimating a full year EPS impact of about $0.70 (Key Development).

Valuation Changes

• Consensus Analyst Price Target has risen from $56.82 to $59.70, reflecting increased earnings potential.
• Discount Rate has increased slightly from 9.92% to 10.62%, suggesting heightened perceived risk or cost of capital.
• Revenue Growth projection has fallen modestly from 5.75% to 5.30%.
• Net Profit Margin estimate has decreased from 8.18% to 7.61%.
• Future P/E ratio forecast has increased from 9.35x to 10.56x. This change indicates the market is assigning a higher valuation multiple to expected earnings.