Microsoft (MSFT), EMC, Expedia (EXPE), and Terex (TEX) all generate free cash flow well in excess of their earnings, notes Barron's, something it thinks value investors should give heed to. Microsoft trades at 9.6x estimated EPS for its current fiscal year, but just 7.9x FCF. For EMC, the multiples are 15.1x and 11.5x; for Expedia, 19.2x and 15.2x; and for Terex, 13.3x and 6.9x. Also, though by no means a value play, Red Hat (RHT) trades at 23x next year's FCF, compared with 40x EPS.
Construction machinery maker Terex (TEX -5.3%) gets hit after beating on its Q3 EPS report but coming up short on revenue earlier this morning. Profit declined 18% Y/Y as sales weakened in its construction and cranes segments. CEO Ron DeFeo notes that macroeconomic events have created near-term softening of demand and uncertainty in many of its business segments. As a result, the company now expects full-year revenue to come in at the low end of its guidance.
Over 100 Demag Cranes shareholders are suing Terex (TEX) for a payout of up to €200M following its $1.4B acquisition of the German company, Reuters reports. Under German law, companies that acquire 75% or more of another firm must offer compensation to remaining shareholders based on a company valuation, not the original bid price. Terex has offered €45.52/share but the investors want over €100.
Terex (TEX +0.8%), which produces equipment such as tower cranes and rock crushers, has begun to search for a CFO to replace Phil Widman, who plans to retire in H1 2013 after overseeing various year-end tasks and facilitating an orderly transition. Widman has been in the role for ten years. (PR)
Five years after record fundraising for P-E firms, the shops still sit on much of that cash and are coming up against the time when they must "use-it-or-lose-it." As most would rather use it, Barron's screens for attractive targets - market cap of $1B-$10B, an Enterprise Value/EBITDA ratio below 10, and annual cash flow of at least 5% of stock market value. The winners: Guess (GES), Terex (TEX), Charles River Labs (CRL), and Big Lots (BIG).
Heavy equipment makers lag the broader market after Caterpillar (CAT -3.2%) lowered its 2015 guidance due to slumping demand for mining equipment as well as a sluggish global economic recovery. CAT's cautious forecast is infecting other stocks that also depend on countries like China to keep building homes and factories: JOY -4%, TEX -4.2%, MTW -5.5%.
Terex (TEX) roars 23% higher following its Q2 EPS beat and increase in FY guidance. Swings to net profit of $85.9M from loss of $0.5M a year earlier. 12-months orders backlog +18% to $2.08B. Now expects FY EPS of $1.95-$2.05 vs. $1.65-$1.85 prior and consensus of $1.76. Forecasts revenue of $7.5B-$7.8B vs. $7.5B-$8B prior and consensus of $7.93B.
Terex Corp is a lifting & material handling solutions company. It is engaged in delivering reliable, customer-driven solutions for a range of commercial applications including construction, infrastructure, quarrying, mining & manufacturing, among others.