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Ternium SA (TX)
NYSE:TX
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Ternium SA
(NYSE:TX)
Rating:70Neutral
Price Target:
$36.00
▲(16.17% Upside)
Ternium SA (TX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.27B
Dividend Yield8.45%
Average Volume (3M)237.64K
Price to Earnings (P/E)73.5
Beta (1Y)0.52
Revenue Growth-10.20%
EPS Growth-152.18%
CountryUS
Employees33,949
SectorBasic Materials
Sector Strength53
IndustrySteel
Share Statistics
EPS (TTM)1.28
Shares Outstanding196,307,680
10 Day Avg. Volume304,029
30 Day Avg. Volume237,641
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.51
Enterprise Value/Revenue0.57
Enterprise Value/Gross Profit4.14
Enterprise Value/Ebitda7.51
Forecast
1Y Price Target
$34.00Price Target Upside9.71% Upside
Rating ConsensusHold
Number of Analyst Covering5
Ternium SA Business Overview & Revenue Model
Company DescriptionTernium S.A. is a leading steel company in Latin America, engaged in the manufacturing and processing of a broad range of steel products. The company is headquartered in Luxembourg and operates in various sectors, including the automotive, energy, construction, and home appliance industries. Ternium offers a comprehensive portfolio of flat and long steel products, as well as value-added services to meet the diverse needs of its customers.
How the Company Makes MoneyTernium S.A. generates revenue primarily through the production and sale of steel products. The company operates a vertically integrated business model, which includes mining operations for raw materials, steel production facilities, and processing plants. This integration allows Ternium to manage costs effectively and ensure a stable supply chain. Key revenue streams include the sale of flat and long steel products, such as hot-rolled, cold-rolled, and coated steel, as well as rebar and wire rod. Ternium serves a diverse customer base across multiple industries, with significant sales in the automotive, construction, and manufacturing sectors. The company also benefits from strategic partnerships and joint ventures that enhance its market reach and operational capabilities. Additionally, Ternium's investment in technology and innovation supports the development of high-value-added products, contributing to its earnings growth.
Ternium SA Earnings Call Summary
Earnings Call Date:Jul 30, 2025
(Q2-2025)
| % Change Since: -5.08%|
Next Earnings Date:Nov 04, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixture of positive and negative aspects. While there were significant improvements in EBITDA, net income, and operational cash flow, challenges remain in the Brazilian market and with shipment declines. The company's proactive measures in cost reduction and sustainable development indicate a forward-looking strategy.Q2-2025 Updates
Positive Updates
Improved EBITDA Performance
Ternium's adjusted EBITDA increased by 25% in the second quarter, driven by stronger realized steel prices in Mexico and operational improvements.
Positive Net Income
Net income for the second quarter of 2025 was $259 million, with adjusted net income (excluding provisions) amounting to $299 million, supported by better operational performance and favorable deferred tax results.
Cost Reduction Initiatives
Ternium is pursuing a $300 million cost reduction target through procurement improvements, process stability, and enhanced productivity measures.
Strong Cash Flow from Operations
Cash from operations in the second quarter totaled $1 billion, with a significant reduction in working capital and a solid cash position of $1 billion at the end of June.
Sustainable Development Commitment
Release of a sustainable report detailing efforts to advance environmental performance and foster social responsibility across operations.
Negative Updates
Challenges in Brazil
The Brazilian steel market is facing significant challenges due to a surge in unfair imported steel, impacting local competitiveness and demand.
Decline in Shipments
Shipments declined in Mexico and the U.S., although partially mitigated by higher volumes in the Southern region.
Provision Adjustment in Usiminas Litigation
A $40 million provision adjustment was made due to ongoing litigation related to the acquisition of a participation in Usiminas.
Company Guidance
During Ternium's Second Quarter 2025 Results Conference Call, the company highlighted several key metrics and future expectations. The second quarter saw a 25% increase in adjusted EBITDA, driven by stronger steel prices in Mexico, despite a slight dip in shipments. Net income was reported at $259 million, including a $40 million provision adjustment related to ongoing litigation. Adjusted net income, excluding this provision, was $299 million, bolstered by a 7.5% revaluation of the Mexican peso. The company anticipates a sequential improvement in EBITDA in the third quarter, expecting a slight increase in shipments, particularly in Mexico, while maintaining stable volumes in Brazil. The call also discussed significant CapEx, with a peak of $2.5 to $2.6 billion expected for 2025, and a robust cash position of $1 billion by the end of June. Ternium's strategy focuses on cost reduction and operational efficiency to enhance margins, with a targeted $300 million in cost savings for the year. The company remains optimistic about its expansion projects in Pesqueria and the long-term sustainability of its operations.Ternium SA Financial Statement Overview
Summary
Ternium SA is experiencing financial challenges with declining revenues and profitability impacting its income statement. The balance sheet remains strong with low leverage, but cash flow concerns persist due to negative free cash flow and high capital expenditures.Income Statement
Ternium SA shows a declining revenue trend over the TTM, with a significant drop in net income, resulting in negative net profit margins. The gross profit margin has also decreased, reflecting increased cost pressures. EBIT and EBITDA margins have deteriorated, indicating operational challenges. However, past years showed stronger profitability, hinting at potential recovery.55
Neutral
Balance Sheet
The balance sheet remains solid with a low debt-to-equity ratio, implying prudent financial leverage. The equity ratio is robust, underscoring strong asset backing. However, the recent decline in stockholders' equity due to net losses could pose future risks if not addressed.75
Positive
Cash Flow
Recent cash flow performance is concerning, with a negative free cash flow in the TTM reflecting high capital expenditures and declining operating cash flows. The operating cash flow to net income ratio is strong, but the trend of declining free cash flow indicates potential liquidity challenges if the situation persists.40
Negative
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 16.71B | 17.65B | 17.61B | 16.41B | 16.09B | 8.74B |
| Gross Profit | 2.29B | 2.88B | 5.26B | 3.93B | 6.20B | 1.64B |
| EBITDA | 1.26B | 1.88B | 2.21B | 3.33B | 5.96B | 1.77B |
| Net Income | -341.77M | -53.67M | 676.04M | 1.77B | 3.83B | 778.47M |
Balance Sheet | ||||||
| Total Assets | 23.72B | 23.13B | 24.18B | 17.49B | 17.10B | 12.86B |
| Cash, Cash Equivalents and Short-Term Investments | 3.75B | 3.85B | 3.82B | 3.53B | 2.57B | 1.35B |
| Total Debt | 2.69B | 2.44B | 1.47B | 1.27B | 1.74B | 2.02B |
| Total Liabilities | 7.18B | 7.00B | 7.37B | 3.72B | 4.86B | 4.41B |
| Stockholders Equity | 12.11B | 11.97B | 12.42B | 11.85B | 10.54B | 7.29B |
Cash Flow | ||||||
| Free Cash Flow | -299.70M | 40.74M | 1.04B | 2.17B | 2.15B | 1.20B |
| Operating Cash Flow | 1.59B | 1.91B | 2.50B | 2.75B | 2.68B | 1.76B |
| Investing Cash Flow | -1.20B | -1.38B | -1.47B | -1.32B | -1.05B | -1.18B |
| Financing Cash Flow | -254.61M | -488.38M | -766.36M | -1.02B | -854.38M | -506.25M |
Ternium SA Technical Analysis
Positive
30.99
Price Trends
30.40
Positive
29.11
Positive
29.19
Positive
Market Momentum
0.28
Positive
47.97
Neutral
22.84
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 30.99 is below the 20-day moving average (MA) of 31.59, above the 50-day MA of 30.40, and above the 200-day MA of 29.19, indicating a neutral trend. The MACD of 0.28 indicates Positive momentum. The RSI at 47.97 is Neutral, neither overbought nor oversold. The STOCH value of 22.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TX.
Ternium SA Risk Analysis
Ternium SA disclosed 47 risk factors in its most recent earnings report. Ternium SA reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Ternium SA Peers Comparison
Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $5.64B | 10.41 | 5.77% | 3.64% | -6.55% | -37.93% | |
71 Outperform | $5.63B | 162.04 | 0.88% | 1.43% | -5.64% | -93.26% | |
70 Neutral | $6.27B | 73.52 | -2.75% | 8.45% | -10.20% | -152.18% | |
68 Neutral | $4.70B | 13.70 | 10.49% | ― | -18.58% | -35.32% | |
64 Neutral | $12.42B | 186.15 | 0.86% | 0.36% | -14.79% | -88.78% | |
58 Neutral | HK$16.45B | 4.32 | -4.93% | 4.59% | -5.74% | -81.55% | |
50 Neutral | $1.73B | ― | -15.57% | 16.51% | -10.77% | -191.87% |
* Basic Materials Sector Average
Performance Comparison
TX
Ternium SA
30.99
0.63
2.08%
CMC
Commercial Metals Company
51.96
0.34
0.66%
GGB
Gerdau SA
2.92
0.00
0.00%
SIM
Grupo Simec SA De CV
28.78
0.18
0.63%
SID
Companhia Siderúrgica Nacional
1.37
-0.54
-28.27%
X
United States Steel
54.84
14.01
34.31%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.