Shares of Terex Corporation continued their upward trajectory in premarket trading on Thursday, advancing 2.1% to $70.50. This gain builds upon a substantial 16.6% surge recorded at Wednesday's close, reflecting a strong positive reaction from investors to the company's newly unveiled long-term financial targets.
Robust Financial Targets for 2026
The machinery manufacturer has issued its first comprehensive financial outlook following the completion of its acquisition of REV Group. Terex is projecting full-year 2026 sales to land between $7.5 billion and $8.1 billion. Concurrently, it forecasts adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) in a range of $930 million to $1.0 billion. The company cited the ongoing integration of REV and anticipated synergy benefits as primary drivers for this optimistic forecast, expecting approximately $28 million in synergies specifically for the 2026 fiscal year.
Fourth-Quarter and Full-Year 2025 Performance
Providing a foundation for its future guidance, Terex reported solid results for the final quarter of 2025. Net sales reached $1.3 billion, marking a 6.2% increase compared to the same period the previous year. Adjusted earnings per share came in at $1.12. While revenue slightly missed the analyst consensus estimate of $1.31 billion, profit per share edged past the $1.11 forecast. For the entirety of 2025, the company generated $5.4 billion in sales with adjusted earnings of $4.93 per share.
A key indicator of future demand, pro forma bookings, surged 32% year-over-year to $1.9 billion for the quarter. This resulted in a book-to-bill ratio of 145%, signaling that new orders significantly outpaced shipments and pointing to a healthy backlog across the company's operating divisions. Free cash flow for the year was reported at $325 million.
Strategic Positioning and Acknowledged Risks
CEO Simon Meester highlighted the company's "considerable momentum" heading into the new year, underpinned by a robust flow of bookings. The acquisition of REV is central to Terex's strategy to broaden its equipment lineup into areas such as environmental solutions, utility vehicles, and specialty transportation. However, the company's outlook is predicated on current macroeconomic conditions, specifically assuming that existing tariff levels, which have pressured its Aerials division, remain unchanged through 2026.
Management was forthright about potential risks that could impact performance. These include unforeseen delays in the REV integration process, a potential weakening in order flow, or any adverse changes to trade policy and tariffs, all of which could negatively affect margins and cash conversion. The company is targeting free-cash-flow conversion of 80% to 90% for 2026, alongside an earnings per share range of $4.50 to $5.00.
Capital Return to Shareholders
In conjunction with its financial updates, Terex's board of directors declared a regular quarterly cash dividend of $0.17 per share. Shareholders of record on March 6, 2026, will be eligible to receive the payment, which is scheduled for distribution on March 19.
As the market digests this detailed outlook, investor focus is likely to remain sharply attuned to early indicators of synergy realization from the REV integration and the associated costs. The forthcoming dividend record date in March also provides a near-term milestone for shareholders. While the recent two-day rally demonstrates strong confidence in Terex's strategic direction, the company's own outlined risks serve as a reminder of the external challenges facing the industrial manufacturing sector.