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Ternium SA (TX)
NYSE:TX
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Ternium SA (TX) AI Stock Analysis

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Ternium SA

(NYSE:TX)

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Neutral 69 (OpenAI - 4o)
Rating:69Neutral
Price Target:
$40.00
▲(10.77% Upside)
Ternium SA's overall stock score reflects a mixed financial performance, with strong technical indicators and valuation metrics providing support. The positive sentiment from the earnings call, despite some regional challenges, contributes to a favorable outlook. However, liquidity concerns and declining profitability weigh on the score.

Ternium SA (TX) vs. SPDR S&P 500 ETF (SPY)

Ternium SA Business Overview & Revenue Model

Company DescriptionTernium 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 MoneyTernium generates revenue primarily through the sale of steel products to various sectors, including construction, automotive, and consumer goods. The company operates on a revenue model that includes both direct sales to end-users and sales through distributors. Key revenue streams consist of the sale of flat steel products, long steel products, and steel processing services. Additionally, Ternium benefits from strategic partnerships with major industries that require substantial steel supplies, which helps secure long-term contracts and stable revenue. Market conditions, such as demand for steel and raw material prices, significantly influence the company's earnings, alongside its operational efficiencies and capacity utilization rates.

Ternium SA Earnings Call Summary

Earnings Call Date:Jul 30, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Nov 04, 2025
Earnings Call Sentiment Neutral
The earnings call presented a generally positive outlook with strong EBITDA growth and cash flow generation. However, challenges in the Brazilian market and ongoing litigation adjustments were notable concerns. Despite these challenges, Ternium remains optimistic about future performance and expansion projects.
Q2-2025 Updates
Positive Updates
Improved EBITDA Performance
Ternium's adjusted EBITDA increased by 25% in the second quarter, mainly driven by stronger realized steel prices in Mexico.
Cash Flow and Balance Sheet Strength
Cash from operations in the second quarter totaled $1 billion, aided by a significant reduction in working capital. The cash position remained solid at $1 billion at the end of June.
Positive Outlook for Mexico
Ternium expects sequential growth in shipments in Mexico due to government measures against unfair trade practices, and continued expansion projects in Pesqueria.
Sustainability Commitment
Release of a sustainable report reaffirming Ternium's commitment to environmental performance, social responsibility, and transparency.
Negative Updates
Challenges in the Brazilian Market
The Brazilian steel market faces challenges due to a surge of unfair imported steel, particularly from China, undermining local competitiveness.
Litigation Adjustments
Net income for the second quarter included a $40 million provision adjustment related to ongoing litigation associated with the acquisition of a participation in Usiminas.
Decline in Shipments
Shipments declined primarily in Mexico and the U.S., partially mitigated by higher volumes in the Southern region.
Company Guidance
In the second quarter of 2025, Ternium reported a 25% increase in adjusted EBITDA, primarily due to higher realized steel prices in Mexico, despite a slight rise in cost per ton. The company's net income for the quarter was $259 million, with an adjusted net income of $299 million after excluding a $40 million provision adjustment related to Usiminas litigation. Ternium anticipates a sequential improvement in EBITDA in the third quarter, supported by expected shipment growth in Mexico, Argentina, and stable volumes in Brazil. The company is implementing cost reduction strategies, targeting an additional $300 million in savings for the year, excluding raw material price effects. Ternium's capital allocation strategy involves significant ongoing investments, with a peak CapEx of $800 million in the second quarter and a forecasted total of $2.5 to $2.6 billion for the year. The company remains committed to sustaining dividend payments while managing its extensive CapEx plan.

Ternium SA Financial Statement Overview

Summary
Ternium SA's financial performance is under pressure with declining revenues and profitability. The balance sheet remains strong with low leverage, but cash flow concerns due to negative free cash flow present liquidity risks.
Income Statement
55
Neutral
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.
Balance Sheet
75
Positive
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.
Cash Flow
40
Negative
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.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue16.71B17.65B17.61B16.41B16.09B8.74B
Gross Profit2.29B2.88B5.26B3.93B6.20B1.64B
EBITDA1.26B1.88B2.21B3.33B5.96B1.77B
Net Income-341.77M-53.67M676.04M1.77B3.83B778.47M
Balance Sheet
Total Assets23.72B23.13B24.18B17.49B17.10B12.86B
Cash, Cash Equivalents and Short-Term Investments3.75B3.85B3.82B3.53B2.57B1.35B
Total Debt2.69B2.44B1.47B1.27B1.74B2.02B
Total Liabilities7.18B7.00B7.37B3.72B4.86B4.41B
Stockholders Equity12.11B11.97B12.42B11.85B10.54B7.29B
Cash Flow
Free Cash Flow-299.70M40.74M1.04B2.17B2.15B1.20B
Operating Cash Flow1.59B1.91B2.50B2.75B2.68B1.76B
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

Technical Analysis Sentiment
Positive
Last Price36.11
Price Trends
50DMA
33.47
Positive
100DMA
31.68
Positive
200DMA
29.73
Positive
Market Momentum
MACD
0.60
Negative
RSI
67.48
Neutral
STOCH
79.33
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 36.11 is above the 20-day moving average (MA) of 34.86, above the 50-day MA of 33.47, and above the 200-day MA of 29.73, indicating a bullish trend. The MACD of 0.60 indicates Negative momentum. The RSI at 67.48 is Neutral, neither overbought nor oversold. The STOCH value of 79.33 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 (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
72
Outperform
$6.56B188.880.88%1.23%-5.64%-93.26%
71
Outperform
$6.29B11.665.77%3.28%-6.55%-37.93%
69
Neutral
$7.09B12.124.89%7.48%-16.83%
69
Neutral
$4.75B13.5910.49%-18.58%-35.32%
61
Neutral
$10.43B7.12-0.05%2.87%2.86%-36.73%
52
Neutral
$6.31B-25.79%-12.14%-4329.00%
50
Neutral
$2.17B-15.57%13.82%-10.77%-192.16%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TX
Ternium SA
36.11
3.09
9.36%
CLF
Cleveland-Cliffs
12.64
-0.07
-0.55%
CMC
Commercial Metals Company
58.01
6.16
11.88%
GGB
Gerdau SA
3.26
-0.09
-2.69%
SIM
Grupo Simec SA De CV
28.54
0.87
3.14%
SID
Companhia Siderúrgica Nacional
1.66
-0.46
-21.70%

Ternium SA Corporate Events

Ternium S.A. Releases Mid-Year Financial Results Amid Market Challenges
Jul 30, 2025

On July 29, 2025, Ternium S.A. released its consolidated financial statements for the period ending June 30, 2025. The report highlights a decrease in net sales and gross profit compared to the previous year, reflecting challenges in the market. The financial results may impact the company’s strategic positioning and stakeholder confidence, as they navigate through a competitive and fluctuating industry environment.

Ternium S.A. Reports Strong Mining Shipments in Q2 2025
Jul 29, 2025

On July 29, 2025, Ternium S.A. reported its financial results for the second quarter and first half of 2025, highlighting a shipment of 3.7 million tons of steel products and 2.0 million tons of mining products. The company achieved an adjusted EBITDA of $403 million and a net income of $259 million, with a net cash position of $1.0 billion. Despite a slight decrease in steel shipments compared to the previous quarter, mining shipments increased significantly, reflecting a robust performance in that segment.

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.Date of analysis: Oct 04, 2025