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Terex (TEX) Q4 Earnings & Revenues Surpass Estimates, Up Y/Y

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Terex Corporation (TEX - Free Report) reported fourth-quarter 2021 adjusted earnings per share of 82 cents, which surpassed the Zacks Consensus Estimate of 54 cents. However, the bottom line improved a whopping 290% from the prior-year quarter, courtesy of strong demand.

Operational Update

Revenues in the reported quarter increased 26% year over year to $990 million, surpassing the Zacks Consensus Estimate of $949 million. The company’s total backlog was up 122% year over year to $3 billion. The Aerial Work Platforms segment witnessed a 137% year-over-year surge in backlog, while the Material Processing segment’s backlog rose 98%.

Cost of goods sold increased 28% year over year to $818 million. Gross profit went up 15% year over year to $172 million.

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 $102 million in the quarter under review, down 13% from the prior-year quarter. Terex reported an operating profit of $69.8 million, which soared 121% from $31.6 million in the last-year quarter. Operating margin expanded 300 basis points year over year to 7% in the quarter under review.

Segmental Performance

The Aerial Work Platforms segment generated revenues of $534 million in the reported quarter, up 30% from the year-ago quarter. The segment reported an operating profit of $25.4 million compared with the prior-year quarter’s loss of $1.9 million. The improvement indicates strong global customer demand and benefits from the company’s strict cost discipline.

The Material Processing segment’s revenues totaled $454 million, reflecting year-over-year growth of 24%. The segment reported an operating income of $62.6 million, up 14% year over year, driven by strong operational performance.

Financial Position

Terex had cash and cash equivalents of $267 million as of Dec 31, 2021, compared with $665 million as of Dec 31, 2020. The company generated $293 million of cash from operating activities in 2021 compared with $225 million in the prior year. Long-term debt was $669 million as of Dec 31, 2021, compared with $1,166.2 million as of Dec 31, 2020.

2021 Performance

Terex reported an adjusted EPS of $3.07 in 2021 compared with 13 cents reported in the prior year. Earnings beat the Zacks Consensus Estimate of $2.79. Sales were up 26% year over year to $3.9 billion, outpacing the Zacks Consensus Estimate of $3.8 billion.

Guidance

Terex noted that end-market demand remains strong, which is promising. It remains focused on overcoming supply disruptions to increase production. The company continues to implement price hikes and cost reductions.

Terex expects sales between $4.1 and $4.3 billion in 2022. TEX’s guidance for 2022 earnings per share is in the range of $3.55 to $4.05.

Sales for the Aerial Work Platforms segment are projected at $2.3-$2.4 billion, while the Material Processing segment’s sales are expected to be $1.8-$1.9 billion. The operation margin for the Aerial Work Platforms segment is expected between 7.8% and 8.5%, while the same for the Material Processing segment is projected at 14.0-14.5%.

Price Performance

Zacks Investment ResearchImage Source: Zacks Investment Research

Terex's shares have gained 13.8% over the past year, compared with the industry’s growth of 2.8%.

Zacks Rank and Stocks to Consider

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

Some better-ranked stocks in the Industrial Products sector include Dover Corporation (DOV - Free Report) , Silgan Holdings Inc. (SLGN - Free Report) and Applied Industrial Technologies, Inc. (AIT - Free Report) . All of these stocks carry a Zacks Rank #2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Dover’s fourth-quarter 2021 adjusted EPS increased 15% year over year to $1.78, beating the Zacks Consensus Estimate of $1.66. DOV has a trailing four-quarter earnings surprise of 12.3%, on average.

Dover has an estimated earnings growth rate of around 12.7% for 2022. In the past 60 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 4%. DOV’s shares have rallied around 34% in a year.

Silgan Holdings’ fourth-quarter 2021 adjusted EPS increased 32% year over year to a record 79 cents, beating the Zacks Consensus Estimate of 73 cents. SLGN has a trailing four-quarter earnings surprise of 3.8%, on average.

Silgan has a projected earnings growth rate of 13.5% for the current year. The Zacks Consensus Estimate for 2022 earnings has moved north by 3% in the past 60 days. In a year, SLGN has appreciated 13%.

Applied Industrial Technologies reported adjusted EPS of $1.46 in second-quarter fiscal 2022 (ended Dec 31, 2020), up 49% year on year and beating the Zacks Consensus Estimate of $1.09. AIT has a trailing four-quarter earnings surprise of 27.9%, on average.

Applied Industrial Technologies has an expected earnings growth rate of 24.8% for fiscal 2022. The Zacks Consensus Estimate for fiscal year earnings has moved up 9.4% in the past 60 days. AIT’s shares have appreciated 18% in a year.