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TeraPlast Stock (BVB: TRP)

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Cristian Cochintu
Cristian Cochintu
23 November 2023

Despite the 2022 downtrend and the sideway evolution during 2023, TeraPlast shares are still popular among Romanian investors and top-performing international funds. While you can buy TRP shares directly, sometimes it is worth considering an ETF with TRP representation.

TeraPlast SA is the parent company of TeraPlast Group - one of the largest Romanian manufacturers of construction materials. TeraPlast SA has been listed on the Bucharest Stock Exchange since July 2, 2008, under the ticker TRP, while its shares are included in the FTSE Russell SmallCap, AllCap indices and is now one of the top holdings in the largest Frontier and Emerging Markets ETFs (FM). 

TeraPlast Shares - Research and Ratings 

  • Is TRP stock undervalued compared to its fair value, analyst forecasts, and its price relative to the market? 
  • What is the analyst 12-month TRP shares price forecast? 
  • What are TRP’s future growth expectations? 
  • How has TeraPlast stock performed over the past 5 years? 
  • Should you buy TRP shares or invest in ETFs with TRP representation

    

Understanding TeraPlast Stock (BVB: TRP): A brief history 

The TeraPlast story goes back to 1896 when the craftsman Walter Schuster set up a ceramic tile workshop. 

TeraPlast Group includes the companies TeraPlast (manufacturer of pipes and granules), TeraGlass (manufacturer of PVC and aluminum windows and doors), and TeraPlast Recycling (recycler and collector of rigid PVC waste). The TeraPlast Group has acquired 70% of Somplast SA, a manufacturer of plastic parts in Bistrita Năsăud County. 

The company has proven its resilience through two world wars, three regime changes, two pandemics, the greatest economic crises in human history, and the uncertainties brought by nationalization in 1948 and the communist regime. 

The production facilities of the companies in the Group are located in the TeraPlast Industrial Park, developed on an area of over 200,000 sqm, in the outskirts of Bistrita. Between 2007 and 2014, the Teraplast Group invested over 260 million lei in the development and modernization of its production capacities and in the expansion of its product portfolio.  

TeraPlast has a sales system that includes a network of owned and rented warehouses. The company also exports its products to Germany, Serbia, Hungary, the Republic of Moldova, Austria, Slovenia, and Bulgaria.  

TRP’s shares are distributed among 4 categories: 

  • GOIA DOREL - 46,8302% 
  • Legal Entities - 22,8262% 
  • Individuals - 18,3274% 
  • FONDUL DE PENSII ADMINISTRAT PRIVAT NN/NN PENSII S.A.F.P.A.P. S.A. - 12,0162%

TeraPlast stock - Fundamental Analysis and Financial Ratings 

See the latest TeraPlast (BVB: TRP) stock price analysis, including valuation, future growth, past performance, and more to help you make more informed investing decisions. 

Valuation 

Is TeraPlast stock undervalued compared to its fair value, analyst forecasts, and its price relative to the market? 

  • TRP is expensive based on its Price-To-Earnings Ratio (1.6x) compared to the peer average (1.4x) 
  • TRP is expensive based on its Price-To-Earnings Ratio (1.6x) compared to the European Chemicals industry average (1x). 
  • TRP (RON0.5) is trading below simplywall.st estimate of fair value (RON 1.62), by more than 20%.   

Future Growth 

Teraplast is forecast to grow earnings and revenue by 101.7% and 28.5% per annum respectively. 

  • TRP is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (5.3%).
  • TRP is forecast to become profitable over the next 3 years, which is considered above average market growth.
  • TRP's revenue (28.5% per year) is forecast to grow faster than the Romanian market (-0.9% per year).
  • TRP's revenue (28.5% per year) is forecast to grow faster than 20% per year.

Past Performance 

How has TeraPlast stock performed over the past 5 years?  
TeraPlast has been growing earnings at an average annual rate of 28.1%, while the Chemicals industry saw earnings growing at 17.9% annually. Revenues have been declining at an average rate of 1.9% per year.

  • TRP is currently unprofitable.
  • TRP is unprofitable, but has reduced losses over the past 5 years at a rate of 28.1% per year.
  • Due to the fact that TRP is unprofitable, making it difficult to compare its past year earnings growth to the Chemicals industry (-11.8%).
  • TRP has a negative Return on Equity (-0.65%), as it is currently unprofitable.

Financial Health  

What is TeraPlast's financial position?  

Teraplast has a total shareholder equity of RON310.2M and total debt of RON206.7M, which brings its debt-to-equity ratio to 66.6%. Its total assets and total liabilities are RON721.2M and RON411.0M respectively. Teraplast's EBIT is RON5.7M making its interest coverage ratio 0.4. It has cash and short-term investments of RON31.9M.

  • TRP's short-term assets (RON356.2 M) exceed its short-term liabilities (RON290.1M). 
  • TRP's short-term assets (RON356.2M) exceed its long-term liabilities (RON120.9 M). 
  • TRP's net debt-to-equity ratio (56.4%) is considered high. 
  • TRP's debt-to-equity ratio has reduced from 88.8% to 66.6% over the past 5 years. 
  • TRP's debt is well covered by operating cash flow (28%). 
  • TRP's interest payments on its debt are not well covered by EBIT (0.4x coverage). 

Dividend 

TeraPlast is a dividend-paying company with a current yield of 29.23% that is well covered by earnings.

  • TRP has been paying a dividend for less than 10 years and during this time payments have been volatile.
  • TRP's dividend payments have increased, but the company has only paid a dividend for 7 years.
  •  
  • TRP's dividend (29.23%) is higher than the bottom 25% of dividend payers in the Romanian market (2.58%). 
  • TRP's dividend (2 9.23%) is in the top 25% of dividend payers in the Romanian market (8.25%). 
  •  With its low payout ratio (16%), TRP's dividend payments are well covered by earnings. 
  • TRP is paying a dividend, but the company has no free cash flows. 

TeraPlast Stock Price Forecast 

What is the analyst 12-month TRP shares price forecast, and do we have any statistical confidence in the consensus price target from analysts?   

As per stockopedia.com, the analyst consensus target price for TeraPlast stock in 2023 is is RON0.64. That is 25.98% above the last closing price of RON0.51.

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Source: investing.com

Investing.com analysts' 12-Month High Price Target is 0.9900 RON, while the Average and Low Price Targets are 0.63 and 0.4300 RON.

There are no 5-year Teraplast stock price forecasts and price predictions. 

Important: When considering Teraplast's fundamental analysis, financial rating and price predictions, it’s important to remember that high market volatility and changing economic environment makes it difficult to give long-term estimates. As such, analysts and algorithm-based platforms can and do get their ratings and predictions wrong. Always do your own research before making an investment decision. And never trade or invest more than you can afford to lose. 

TeraPlast Stock (BVB: TRP) - Technical Analysis  

After the 2022 downside correction to the general ascending trend, TeraPlast shares price is now moving sideways, in a mid-term range between 0.65 RON (which is the near-term key resistance) and 0.45 RON (support). Short-term, price is moving inside a downtrend channel, making lower highs and lows     

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A breakdown below the 0.45 level would open the way to lower support levels, such as 0.4185. On the other hand, if bulls manage to keep the 0.45 area, a rebound would first target the 0.52 level and higher, 0.55 RON.

How to Invest in TeraPlast Stock 

Some investors want to take an active hand in managing their investments, while others prefer to set it and forget it. Your preference may change but decide on an approach to get started. 

For most people, stock market investing means choosing among these two investment types: 

Individual TeraPlast shares  

If you’re after a specific company, you can buy a single share or a few shares to dip your toe into the stock-trading waters. Building a diversified portfolio out of many individual stocks is possible, but it takes significant investment and research. 

If you go this route, remember that individual stocks will have ups and downs. If you research a company and choose to invest in it, think about why you picked that company in the first place if jitters start to set in on a down day. 

Traditional stockbrokers allow you to invest in local stocks. However, you might not be able to invest in international stocks listed on the major stock exchanges, global ETFs, and other assets. 

 

ETFs with TeraPlast holdings 

TeraPlast stock (or any single stock, for that matter) can be a very volatile investment. You can manage the risk you see extreme highs and lows by diversifying your investment holdings. An ETF, for instance, contains a basket of individual stocks. When you invest in a fund, you also own small pieces of each of those companies. 

 

If you want an ETF with TeraPlast representation, you might consider iShares MSCI Frontier and Select ETF. BlackRock's iShares is the largest provider of ETFs as calculated by assets under management. 

iShares MSCI Frontier and Select EM ETF_20230516165547.png

The fund can be suitable for Romania and foreign investors who want liquid and diversified exposure to another top 9 companies listed on the Bucharest Stock Exchange: 

Banca Transilvania (BSE: TLV)
OMV Petrom (BSE: SNP)
Romgaz (BSE: SNG)
BRD (BSE: BRD)
Transgaz (BSE: TGN)
Electrica (BSE: EL)
MedLife (BSE: M)
Nuclearelectrica (BSE: SNN)
One United Properties (BSE: ONE)

 

Why invest in TeraPlast Stock via FM? 

With net assets of almost $1B, The iShares MSCI Frontier and Select EM ETF (FM) is the largest exchange-traded-fund that seeks to track the investment results of an index composed primarily of frontier market equities along with select emerging market equities. 

  • Exposure to frontier market stocks and smaller size emerging market stocks with an emphasis on tradability and investability of the underlying constituents 
  • One-click access to a virtually untapped investment portfolio with a Bucharest Stock Exchange and BET index exposure. 
  • Use to seek long-term growth and diversification 

How to Get Started with CAPEX.com 

Here is how to buy and trade stocks, ETFs and other assets with an international, highly regulated broker like CAPEX.com: 

  • Choose which type of account you want to use. Your first concern should be your risk appetite and time horizon. If you want to buy and hold shares, open an Invest account. If you want to speculate on price movements (including falling prices) with zero commission and leverage, open a CFD trading account. 
  • Create an account. Regardless of your chosen account, you need to register and complete the KYC process to verify your identity. 
  • Fund your account with fiat money. Before buying and trading stocks and ETFs, you need to fund your exchange account with U.S. dollars, Euros, or other currencies. 
  • Place your order. Click on the "Search" icon located in the left panel or by clicking on "ETFs" and then select the instrument, such as "iShares MSCI Frontier and Select EM ETF”.  

    

When trading stocks, the CFDs (contracts for difference) are stored in your account and are more liquid than the underlying asset.  

However, you should be aware that CFD trading is fast-moving and requires close monitoring. As a result, traders should be aware of the significant risks when trading CFDs. There are margins you need to maintain; if you cannot cover reductions in values, your position might be closed, and you'll have to meet the loss no matter what subsequently happens to the underlying asset. 

With CAPEX, you can trade CFDs on +2.000 stocks and invest in +5.000 stocks and ETFs with ownership. 

Free resources 

Before you start investing in shares, you should consider using the educational resources we offer like CAPEX Academy or a demo trading account. CAPEX Academy has lots of free trading courses for you to choose from, and they all tackle a different financial concept or process – like the basics of analyses – to help you to become a more informed trader. 

Our demo account is a great place for you to learn more about leveraged trading, and you’ll be able to get an intimate understanding of how CFDs work – as well as what it’s like to trade with leverage – before risking real capital. For this reason, a demo account with us is a great tool for investors who are looking to make a transition to leveraged trading. 

Sources:  

Investitori - Investitori TeraPlast 
Teraplast (BVB:TRP) - Stock Price, News & Analysis - Simply Wall St 
BVB - Actiuni TRP TERAPLAST SA 
Teraplast Bist (TRP) Stock Forecast & Price Target - Investing.com 
Teraplast SA Share Price - BSE:TRP Stock Research | Stockopedia 

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Cristian Cochintu
Cristian Cochintu
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Cristian Cochintu writes about trading and investing for CAPEX.com. Cristian has more than 15 years of brokerage, freelance, and in-house experience writing for financial institutions and coaching financial writers.