Terex Corporation (TEX) and Wabco Holdings (WBC) Critical Analysis
Terex Corporation (NYSE: TEX) and Wabco Holdings (NYSE:WBC) are both mid-cap industrial products companies, but which is the superior business? We will compare the two companies based on the strength of their profitabiliy, earnings, valuation, risk, dividends, analyst recommendations and institutional ownership.
Valuation & Earnings
This table compares Terex Corporation and Wabco Holdings’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Terex Corporation||$4.22 billion||0.86||$152.10 million||($0.63)||-60.16|
|Wabco Holdings||$2.93 billion||2.50||$479.40 million||$6.00||22.79|
Wabco Holdings has higher revenue, but lower earnings than Terex Corporation. Terex Corporation is trading at a lower price-to-earnings ratio than Wabco Holdings, indicating that it is currently the more affordable of the two stocks.
Terex Corporation pays an annual dividend of $0.32 per share and has a dividend yield of 0.8%. Wabco Holdings does not pay a dividend. Terex Corporation pays out -50.8% of its earnings in the form of a dividend. Wabco Holdings has raised its dividend for 3 consecutive years.
Insider & Institutional Ownership
90.9% of Terex Corporation shares are held by institutional investors. 2.5% of Terex Corporation shares are held by company insiders. Comparatively, 0.8% of Wabco Holdings shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
This table compares Terex Corporation and Wabco Holdings’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent recommendations for Terex Corporation and Wabco Holdings, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Terex Corporation presently has a consensus target price of $36.15, suggesting a potential downside of 4.61%. Wabco Holdings has a consensus target price of $133.67, suggesting a potential downside of 2.26%. Given Wabco Holdings’ stronger consensus rating and higher probable upside, analysts plainly believe Wabco Holdings is more favorable than Terex Corporation.
Risk & Volatility
Terex Corporation has a beta of 1.85, suggesting that its share price is 85% more volatile than the S&P 500. Comparatively, Wabco Holdings has a beta of 1.65, suggesting that its share price is 65% more volatile than the S&P 500.
Wabco Holdings beats Terex Corporation on 10 of the 17 factors compared between the two stocks.
Terex Corporation Company Profile
Terex Corporation is a manufacturer of lifting and material processing products and services that deliver lifecycle solutions. The Company has three business segments: Aerial Work Platforms (AWP), Cranes and Materials Processing (MP). It delivers lifecycle solutions to a range of industries, including the construction, infrastructure, manufacturing, shipping, utility, quarrying and mining industries. The AWP segment designs, manufactures, services and markets aerial work platform equipment, telehandlers and light towers. The AWP segment’s products are used by its customers to construct and maintain industrial, commercial and residential buildings and facilities, and for other commercial operations, as well as in a range of infrastructure projects. The Cranes segment’s products are used by its customers for construction and manufacturing facilities, among others. The MP segment’s products are used by its customers in construction, infrastructure and recycling projects.
Wabco Holdings Company Profile
WABCO Holdings Inc. is a supplier of electronic, mechanical, electro-mechanical and aerodynamic products for various manufacturers of commercial trucks, buses and trailers, as well as passenger cars. The Company engineers, develops, manufactures and sells braking, stability, suspension and transmission automation and air management systems primarily for commercial vehicles. Its products are pneumatic anti-lock braking systems, electronic braking systems, electronic stability control systems, brake controls, automated manual transmission systems, air disc brakes, and a range of conventional mechanical products, such as actuators, air compressors and air control valves for medium- and heavy-duty trucks, buses and trailers. The Company’s products also include air compressor and air processing/air management system; electronic and conventional air suspension systems; transmission automation; roll stability support; advanced driver assistance systems, and fleet management solutions.
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