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Terex Corp TEX

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Morningstar’s Analysis

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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Terex’s Focus on Its Two Core Segments Leads Us to Upgrade Our Moat Rating to Narrow

Dawit Woldemariam Equity Analyst

Analyst Note

| Dawit Woldemariam |

After taking a fresh look at our thesis for Terex, we’ve increased our fair value estimate to $40.50 from $31 to reflect stronger end-market performance than we previously forecast. We also upgraded our moat rating to narrow after concluding that the company’s two core segments benefit from intangible assets. Each of Terex’s segments possess strong brands that customers value. The company provides customers with reliable, high-quality products while offering a lower total cost of ownership thanks to strong residual values. In aerial products, Terex’s Genie brand is a top two player in developed markets, providing customers with booms, lifts, and telehandlers. Terex is also a market leader in materials processing, particularly in crushing and screening, a key downstream process for infrastructure projects.

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Company Profile

Business Description

Terex is a global manufacturer of aerial work platforms, materials processing equipment, and specialty equipment, such as material handlers, cranes, and concrete mixer trucks. Its current composition is a result of numerous acquisitions over several decades and a recent shift to focus on its two core segments after divesting a handful of underperforming businesses. These remaining segments see heavy demand in nonresidential construction as well as in maintenance, manufacturing, energy, and materials management.

Contact
45 Glover Avenue, 4th Floor
Norwalk, CT, 06850
T +1 203 222-7170
Sector Industrials
Industry Farm & Heavy Construction Machinery
Most Recent Earnings Jun 30, 2021
Fiscal Year End Dec 31, 2021
Stock Type Cyclical
Employees 8,200

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