Ternium SA (TX) AI Stock Analysis

• Market Cap: $7.55B
• Dividend Yield: 7.02%
• Average Volume (3M): 154.16K
• Price to Earnings (P/E): 13.1
• Beta (1Y): 0.52
• Revenue Growth: -16.69%
• EPS Growth: 585.38%
• Country: US
• Employees: 33,949
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Steel
• EPS (TTM): 0.25
• Shares Outstanding: 196,307,680
• 10 Day Avg. Volume: 174,786
• 30 Day Avg. Volume: 154,157
• PEG Ratio: 0.98
• Price to Book (P/B): 0.48
• Price to Sales (P/S): 0.32
• P/FCF Ratio: 140.13
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 0.48
• Enterprise Value/Gross Profit: 3.41
• Enterprise Value/Ebitda: 4.00
• 1Y Price Target: $40.50
• Price Target Upside: 5.36% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 68 Neutral
• Price Target: $42.00 ▲(9.26% Upside)

Ternium SA's overall stock score reflects a balance of positive technical indicators and attractive valuation against mixed financial performance and challenges highlighted in the earnings call. The strong dividend yield and reasonable P/E ratio are significant positives, while liquidity concerns and market challenges temper the outlook.

Positive Factors

Vertical Integration

Vertical integration allows Ternium to optimize costs and improve margins, providing a durable competitive advantage in the steel industry.

Strong Cash Generation

Strong cash generation enhances Ternium's financial flexibility, supporting reinvestment and shareholder returns, crucial for long-term growth.

Stake Increase in Usiminas

Increasing its stake in Usiminas strengthens Ternium's market position in Brazil, enhancing strategic influence and growth potential in the region.

Negative Factors

Declining Revenue

Declining revenue reflects challenges in maintaining growth, potentially impacting Ternium's market position and long-term profitability.

Negative Free Cash Flow

Negative free cash flow suggests liquidity issues, limiting Ternium's ability to invest in growth opportunities and manage financial obligations.

Challenges in Mexican Steel Demand

Challenges in Mexican steel demand due to trade policy uncertainties could affect Ternium's regional sales and operational stability.

Ternium SA Business Overview & Revenue Model

Company Description

Ternium S.A. manufactures, processes, and sells various steel products in Mexico, Argentina, Paraguay, Chile, Bolivia, Uruguay, Brazil, the United States, Colombia, Guatemala, Costa Rica, Honduras, El Salvador, and Nicaragua. It operates through two segments, Steel and Mining. The Steel segment offers slabs, billets and round bars, hot rolled flat products, merchant bars, reinforcing bars, stirrups and rods, tin plate and galvanized products, tubes, beams, insulated panels, roofing and cladding, roof tiles, steel decks, pre-engineered metal building systems, and pig iron products; and sells energy. The Mining segment sells iron ore and pellets. The company also provides medical and social; scrap; and engineering and other services, as well as operates as a distribution company. It serves various companies and small businesses in the construction, automotive, home appliances, agro, packaging, transport, and energy industries. The company was founded in 1961 and is based in Luxembourg City, Luxembourg. Ternium S.A. is a subsidiary of Techint Holdings S.à r.l.

How the Company Makes Money

Ternium generates revenue primarily through the sale of steel products, which are used in multiple industries, including construction, automotive, and consumer goods. The company's revenue model is based on direct sales to customers, with a significant portion coming from long-term contracts with major clients in various sectors. Additionally, Ternium benefits from vertical integration, controlling various stages of production from raw materials to finished products, which helps to optimize costs and improve margins. The company also engages in export activities, selling its products to international markets, which contributes to its revenue. Significant partnerships with key players in the automotive and construction industries enhance its market position and ensure steady demand for its products.

Ternium SA Financial Statement Overview

Summary

Ternium SA's financial performance is mixed. The income statement shows pressure on profitability with a low gross profit margin and declining revenue. The balance sheet is stable with low leverage, but cash flow issues are concerning, with negative free cash flow indicating potential liquidity problems.

Income Statement

Ternium SA's income statement shows a mixed performance. The TTM (Trailing-Twelve-Months) gross profit margin is 14%, which is below the historical average, indicating pressure on profitability. The net profit margin has improved to 1.87% from a negative margin in the previous year, showing signs of recovery. However, revenue has declined by 3.24% in the TTM period, reflecting challenges in maintaining growth. The EBIT and EBITDA margins are stable but lower than historical highs, suggesting operational efficiency issues.

Balance Sheet

The balance sheet of Ternium SA reflects a stable financial position with a debt-to-equity ratio of 0.17 in the TTM period, indicating low leverage. The return on equity has improved to 2.44% from a negative value in the previous year, showing better utilization of equity. The equity ratio remains strong at over 50%, suggesting a solid capital structure. However, the overall return on equity is still below historical levels, indicating room for improvement in profitability.

Cash Flow

Cash flow analysis reveals some concerns for Ternium SA. The free cash flow is negative in the TTM period, indicating cash outflows exceeding inflows. The operating cash flow to net income ratio is 0.43, suggesting that cash generation from operations is not fully supporting net income. The free cash flow to net income ratio is negative, highlighting potential liquidity issues. Despite a positive free cash flow growth rate, the overall cash flow situation requires attention.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	15.71B	17.65B	17.61B	16.41B	16.09B	8.74B
Gross Profit	2.20B	2.89B	5.26B	3.93B	6.20B	1.64B
EBITDA	1.87B	1.67B	2.16B	3.33B	6.38B	1.84B
Net Income	583.88M	-53.67M	676.04M	1.77B	3.83B	778.47M
Balance Sheet
Total Assets	23.47B	23.13B	24.18B	17.49B	17.10B	12.85B
Cash, Cash Equivalents and Short-Term Investments	2.76B	3.85B	3.82B	3.53B	2.57B	1.35B
Total Debt	2.26B	1.79B	1.47B	771.85M	916.09M	2.02B
Total Liabilities	7.17B	7.00B	7.37B	3.72B	4.86B	4.41B
Stockholders Equity	11.98B	11.97B	12.42B	11.85B	10.54B	7.28B
Cash Flow
Free Cash Flow	-341.73M	40.74M	1.04B	2.17B	2.15B	1.20B
Operating Cash Flow	2.26B	1.91B	2.50B	2.75B	2.68B	1.76B
Investing Cash Flow	-1.74B	-1.38B	-1.47B	-1.32B	-1.05B	-1.18B
Financing Cash Flow	-750.04M	-488.38M	-766.36M	-1.02B	-854.38M	-506.25M

Ternium SA Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 38.44
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TX, the sentiment is Positive. The current price of 38.44 is above the 20-day moving average (MA) of 38.00, above the 50-day MA of 36.51, and above the 200-day MA of 31.63, indicating a bullish trend. The MACD of 0.53 indicates Positive momentum. The RSI at 57.67 is Neutral, neither overbought nor oversold. The STOCH value of 67.53 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TX.

Ternium SA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SIM	73 Outperform	$5.06B	25.01	5.84%	―	-16.81%	-67.68%
CMC	70 Neutral	$7.91B	96.00	1.99%	1.02%	-1.61%	-81.36%
TX	68 Neutral	$7.55B	13.14	4.80%	7.02%	-16.69%	585.38%
GGB	67 Neutral	$6.97B	14.19	5.21%	2.92%	-2.53%	-36.08%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
CLF	54 Neutral	$7.88B	―	-27.16%	―	-6.76%	-255.94%
SID	51 Neutral	$2.18B	-7.99	-10.50%	―	-5.79%	-5.30%

Ternium SA Corporate Events

Ternium Expands Stake in Usiminas with $315.2 Million Acquisition

On November 5, 2025, Ternium S.A. announced that its subsidiary, Ternium Investments S.à r.l., has entered into an agreement to acquire the remaining shares from Nippon Steel Corporation and Mitsubishi Corporation in the control group of Usinas Siderúrgicas de Minas Gerais S.A. (Usiminas). This acquisition, valued at approximately $315.2 million, will increase Ternium’s stake in Usiminas from 51.5% to 83.1%, subject to approval by Brazil’s antitrust authorities. This move is set to enhance Ternium’s influence in the Brazilian steel market and aligns with its strategy to maximize Usiminas’ potential, benefiting all stakeholders involved.

Ternium S.A. Reports Decline in Financial Performance as of September 2025

On October 28, 2025, Ternium S.A. released its consolidated financial statements for the period ending September 30, 2025, showing a decline in net sales and gross profit compared to the previous year. The financial results indicate a challenging market environment, impacting the company’s profitability and potentially affecting its strategic positioning in the steel industry.

Ternium S.A. Reports Q3 2025 Financial Results Amid Challenges

On October 28, 2025, Ternium S.A. reported its financial results for the third quarter and the first nine months of 2025, ending September 30. The company experienced a net loss of $270 million in the third quarter, attributed to a $405 million non-cash charge related to a write-down of deferred tax assets at Usiminas and a $32 million loss from ongoing litigation. Despite these challenges, Ternium saw a slight increase in steel and mining product shipments compared to the previous quarter, with adjusted EBITDA rising to $420 million. The company also announced an interim dividend of $0.90 per ADS, reflecting its commitment to returning value to shareholders.