Terex (TEX) Down 8.5% Since Last Earnings Report: Can It Rebound?

It has been about a month since the last earnings report for Terex (TEX). Shares have lost about 8.5% in that time frame, underperforming the S&P 500.

But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Terex due for a breakout? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for Terex Corporation before we dive into how investors and analysts have reacted as of late.

Terex Q4 Earnings Match Estimates, Up Y/Y

Terex reported adjusted earnings per share of $1.12, which matched the Zacks Consensus Estimate. The bottom line marked a 45.5% increase from the prior-year quarter’s adjusted figure of 77 cents per share. Including one-time items, Terex reported earnings of 95 cents per share in the fourth quarter of 2025 against a loss of three cents per share in the year-ago quarter.

Terex’s Revenues & Bookings Up Y/Y

Revenues rose 6.2% year over year to $1.318 billion, but missed the Zacks Consensus Estimate of $1.326 billion. Excluding ESG, the company’s legacy revenues rose 5.4% year over year, driven by higher sales in Aerials and Utilities business. Terex’s bookings increased 32% year over year to $1.9 billion in the quarter, resulting in a book-to-bill of 145%.

TEX’s Adjusted Margins Expand in Q4

The cost of goods sold increased 2.5% year over year to around $1 billion. Gross profit, including one-time items, was $248 million in the quarter compared with $197 million in the year-ago quarter. Adjusted gross profit increased 26% to $248 million. Adjusted gross margin was 18.8% in the quarter compared with 15.9% in the year-ago quarter. Selling, general and administrative expenses were $111 million, down 23% from the prior-year quarter. Adjusted selling, general and administrative expenses were $146 million.

Terex reported an operating profit of $137 million, which marked 158.5% growth from the prior-year quarter. The operating margin was 10.4%, higher than the 4.3% margin in the last quarter. Adjusted operating profit was $123 million compared with $97 million in the year-ago quarter. Adjusted operating margin was 9.3%, higher than the 7.8% reported in last year’s quarter. Higher margins were led by improvements in all three segments, as cost productivity actions and higher volume in Environmental Solutions and Materials Processing more than offset higher tariff costs and other inflation.

TEX’s Segment Performances in Q4

The Material Processing segment’s revenues totaled $428 million, reflecting a year-over-year decline of 2.5%. Excluding the impact of the divestiture of the European tower and rough terrain crane businesses, the segment’s sales increased 2.8% in the quarter. The segment reported an operating income of $97 million, up 106% year over year. Adjusted operating profit was $59 million compared with $48 million in the fourth quarter of 2024. Cost productivity, mix and pricing actions helped offset the impact of tariffs and other inflationary headwinds on profit.

The Aerials segment generated revenues of $466 million, up 7% from the year-ago quarter, reflecting growth in North America and EMEA. The segment reported an operating profit of $10 million, representing a 900% surge year over year. Adjusted operating profit was $12 million in the fourth quarter of 2025 compared with $2 million in the year-ago quarter.

The Environmental Solutions segment reported revenues of $428 million, up 14.1% year over year on a pro forma, aided by strong throughput and delivery of Utility and Refuse Collection Vehicles (RCVs). Operating profit was $59 million and the adjusted operating profit was $79 million. Adjusted operating profit expanded 90 basis points to 18.5%, reflecting continued margin improvements in Terex Utilities.

Terex’s Cash Flow & Balance Sheet Updates

Terex had cash and cash equivalents of $772 million as of Dec. 31, 2025, compared with $388 million as of Dec. 31, 2024. The company generated $440 million in cash from operating activities in 2025 compared with $326 million in the prior year. Full-year free cash flow was $325 million in 2025, representing a 147% cash conversion. As of Dec. 31, 2025, liquidity (cash and availability under revolving line of credit) was $1.6 billion. Terex returned $98 million to shareholders in 2025 through share repurchases and dividends. The company had $183 million remaining available for repurchase under its share repurchase program.

Terex’s 2025 Performance

Terex reported adjusted earnings per share of $4.93, which declined 19% from the prior year. Including one-time items, Terex reported earnings of $3.33 per share in 2025 compared with earnings of $4.96 in 2024. Revenues rose 5.7% year over year to $5.42 billion.

Terex’s Outlook for 2026

The Environmental Solutions segment’s sales are expected to be up in mid-single digits from the prior-year baseline of $1.691 billion. Terex expects sales for the Materials Processing segment to be up in high single digits compared with the prior-year baseline of $1.578 billion. The Aerials segment’s revenues are expected to remain flat compared with the prior-year baseline of $2.06 billion. Specialty Vehicles (REV) sales expected to be up in high single digits from base line of $2.179 billion.

Backed by strong fourth-quarter bookings and backlog in every segment, net sales are projected to be in the range of $7.5-$8.1 billion. The guidance implies year-over-year growth of 5% on a proforma basis. EBITDA is expected to be between $930 million and $1 billion. EBITDA margin is projected at 12.4% at the midpoint Terex expects adjusted earnings per share to be between $4.50 and $5.00. Terex expects free cash flow conversion in the range of 80-90%.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended downward during the past month.

The consensus estimate has shifted -9.65% due to these changes.

VGM Scores

Currently, Terex has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a score of B on the value side, putting it in the top 40% for value investors.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Terex has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.

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This article originally published on Zacks Investment Research (zacks.com).

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