Oshkosh & Terex' Orders Strength To Decide The Near-Term Fate, Cautious Analyst Downgrades Stock

KeyBanc Capital Markets analyst Steve Barger downgraded Oshkosh Corp OSK and Terex Corp TEX to Sector Weight from Overweight.

Although the analyst sees significant project funding visibility and elevated backlogs driving financial results this year, he expects order rates to moderate from recent high levels.

Barger believes 'decelerating B:Bs,' contraction in backlog, and return of forward revenue visibility to historical ranges can increase fears of peak cycle conditions.

Overall, amid the current environment, the analyst suspects potential signs of bad news outsizing negative impact on shares compared to the possible good news. 

OSK: The analyst modestly lowered the EPS estimate to $8.03 (from $8.17, consensus $8.02) for 2023 and $9.17 (from $9.29, consensus $9.00) for 2024. 

Barger sees the 2025 EPS estimate of $10.56 vs. the consensus of $9.31.

Related: These Analysts Increase Their Forecasts On Oshkosh Following Strong Q2 Results

TEX: The analyst reaffirmed the 2023 EPS estimate at $7.11 (consensus $7.16) and lowered the 2024 EPS estimate to $7.57 (from $8.12, consensus $7.28).

Barger estimates 2025 EPS of $8.03 (consensus $7.10). 

The analyst has less confidence in 2025 estimates for both companies as they can vary according to the strength of orders in the coming four to six quarters.

Price Action: OSK shares are trading lower by 0.42% at $96.27, and TEX shares are up 0.34% at $58.69 on the last check Thursday.