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Ternium (TX) to Report Q2 Earnings: What's in the Cards?

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Ternium S.A. (TX - Free Report) is slated to release second-quarter 2021 results after the closing bell on Aug 3. Benefits of higher steel prices and healthy shipments are likely to reflect on its second-quarter results.

The Luxembourg-based company surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average being 126.3%. It posted an earnings surprise of roughly 23.3% in the last reported quarter.

The stock has rallied 226.5% in the past year compared with the industry’s 133.4% rise.


Zacks Investment Research
Image Source: Zacks Investment Research

Let’s see how things are shaping up for this announcement.

What do the Estimates Indicate?

The Zacks Consensus Estimate for Ternium’s second-quarter consolidated sales is currently pegged at $3,773 million, which calls for an increase of 116.1% from the year-ago quarter’s tally.

Some Factors at Play

The company is likely to have benefited from higher prices and stable shipment volumes in the second quarter. Ternium, in its first-quarter call, said that it expects EBITDA and margins to increase in the second quarter on a sequential comparison basis on higher realized steel prices.

Higher shipments in Mexico are also expected to have aided the company’s second-quarter performance. Shipments in Mexico are likely to have been driven by strong demand from industrial customers in the quarter to be reported. Moreover, higher demand for durable goods and construction materials is expected to have supported shipments in Argentina.

Moreover, Ternium benefited from higher steel prices in its major markets in the first quarter. The pricing strength, backed by heathy steel prices in the North American market, is expected to have continued in the June quarter and supported the company’s top line. However, higher cost per ton is likely to have affected its performance. Ternium is seeing higher costs for many of its raw materials such as iron ore and scrap.

Ternium S.A. Price and EPS Surprise


Ternium S.A. Price and EPS Surprise

Ternium S.A. price-eps-surprise | Ternium S.A. Quote


Zacks Model

Our proven model does not conclusively predict an earnings beat for Ternium this season. The combination of a positive Earnings ESP  and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.

Earnings ESP: Earnings ESP for Ternium is 0.00%. The Zacks Consensus Estimate for earnings for the second quarter is currently pegged at $3.83. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Ternium currently carries a Zacks Rank #3.

Stocks That Warrant a Look

Here are some companies in the basic materials space you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:

LyondellBasell Industries N.V. (LYB - Free Report) , scheduled to release earnings on Jul 30, has an Earnings ESP of +6.99% and sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Westlake Chemical Corporation (WLK - Free Report) scheduled to release earnings on Aug 3, has an Earnings ESP of +1.50% and carries a Zacks Rank #1.

Eastman Chemical Company (EMN - Free Report) , scheduled to release earnings on Aug 2, has an Earnings ESP of +0.90% and carries a Zacks Rank #3.

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