Raymond James maintains Terex stock rating, sees margin pressure in AWP segment

Published 07/07/2025, 12:12
Raymond James maintains Terex stock rating, sees margin pressure in AWP segment

Investing.com - Raymond (NSE:RYMD) James has reiterated its Market Perform rating on Terex (NYSE:TEX), adjusting its second-quarter adjusted EPS estimate to $1.39. The company, currently trading at $49.79 with a P/E ratio of 13.26x, has shown mixed performance with a YTD return of 8.58%. According to InvestingPro data, 5 analysts have recently revised their earnings estimates downward for the upcoming period.

The investment firm expects solid results in Terex’s Environmental Solutions segment despite likely sequential EBIT margin declines, supported by strength in refuse and utility end markets and accelerated synergy capture that could exceed the company’s initial $25 million target.

Raymond James anticipates sequential margin improvement in the Material Processing segment to approximately 12.5%, aligning with company guidance, while projecting that the Aerial Work Platforms segment will fall short of Terex’s target to reach double-digit margins in the second quarter.

The firm revised its full-year EPS estimate to $4.95, noting that Terex assumed an easing in tariffs from announced rates, which may result in less relative incremental upside to second-half guidance.

While maintaining its Market Perform rating, Raymond James highlighted that Terex’s 2026E EV/EBITDA of 7.0x compares favorably to peers’ approximately 10.0x, suggesting the risk/reward at current levels is becoming more compelling despite recent underperformance related to tariff concerns and relatively high leverage. Based on InvestingPro’s Fair Value analysis, the stock appears slightly overvalued at current levels, despite maintaining a healthy dividend yield of 1.37% and demonstrating strong financial health with a GOOD overall score.

In other recent news, Terex Corporation’s financial outlook has been the focus of several major analysts. Goldman Sachs upgraded Terex’s stock rating to Buy, raising the price target to $60, based on anticipated recovery in the Aerials segment and the positive impact of the Environmental Services Group acquisition. Meanwhile, JPMorgan increased its price target to $50, maintaining a Neutral rating, citing potential margin improvements and stable inventory levels. UBS also upgraded Terex from Sell to Neutral, setting a price target of $48, noting the company’s strong management and ESG initiatives, while acknowledging potential earnings pressure in 2025.

Citi analyst Kyle Menges raised the price target to $51 following Terex’s strong first-quarter results, highlighting robust bookings and easing tariffs. The analyst revised the 2025 EPS forecast to $4.95, up from $4.55, and maintained a Neutral rating, pointing to growth potential in the Materials Processing division. Additionally, Terex announced an amendment to its bylaws and held its Annual Meeting, where all eight directors were re-elected, and KPMG LLP was ratified as the independent auditor. The company also made procedural updates for shareholder nominations, aligning with Delaware law amendments.

These developments reflect Terex’s strategic efforts to navigate market conditions and improve its financial performance, as seen in the revisions of earnings estimates and stock ratings by various analysts.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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