In the latest trading session, Ternium S.A. (TX) closed at $44.27, marking a +0.07% move from the previous day. The stock lagged the S&P 500’s daily gain of 0.74%.
Prior to today’s trading, shares of the company had lost 0.98% over the past month. This has lagged the Basic Materials sector’s gain of 4.68% and the S&P 500’s gain of 1.34% in that time.
TX will be looking to display strength as it nears its next earnings release, which is expected to be November 2, 2021. In that report, analysts expect TX to post earnings of $4.62 per share. This would mark year-over-year growth of 657.38%. Meanwhile, our latest consensus estimate is calling for revenue of $4.1 billion, up 91.84% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $17.28 per share and revenue of $15.54 billion, which would represent changes of +472.19% and +77.91%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for TX. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 2.03% higher within the past month. TX is currently sporting a Zacks Rank of #1 (Strong Buy).
Valuation is also important, so investors should note that TX has a Forward P/E ratio of 2.56 right now. For comparison, its industry has an average Forward P/E of 4.33, which means TX is trading at a discount to the group.
Investors should also note that TX has a PEG ratio of 0.14 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. The Steel – Producers was holding an average PEG ratio of 0.18 at yesterday’s closing price.
The Steel – Producers industry is part of the Basic Materials sector. This group has a Zacks Industry Rank of 30, putting it in the top 12% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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