Commercial Metals (NYSE:CMC) Shares Gap Down Following Weak Earnings

Commercial Metals (NYSE:CMC)’s stock price gapped down prior to trading on Thursday after the company announced weaker than expected quarterly earnings. The stock had previously closed at $46.86, but opened at $45.13. Commercial Metals shares last traded at $46.85, with a volume of 162,781 shares traded.

The basic materials company reported $0.26 earnings per share for the quarter, missing the consensus estimate of $0.38 by ($0.12). Commercial Metals had a return on equity of 9.88% and a net margin of 1.70%. The company had revenue of $1.75 billion for the quarter, compared to analyst estimates of $1.73 billion. During the same period last year, the firm earned $0.88 EPS. The firm’s revenue for the quarter was down 5.1% compared to the same quarter last year.

Commercial Metals Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Wednesday, April 9th. Stockholders of record on Monday, March 31st will be paid a dividend of $0.18 per share. This represents a $0.72 annualized dividend and a dividend yield of 1.55%. Commercial Metals’s dividend payout ratio is presently 64.86%.

Analyst Ratings Changes

A number of brokerages have weighed in on CMC. Morgan Stanley lowered their price target on Commercial Metals from $56.00 to $53.00 and set an “equal weight” rating on the stock in a research report on Friday, March 7th. The Goldman Sachs Group began coverage on Commercial Metals in a report on Monday, December 2nd. They set a “buy” rating and a $75.00 target price on the stock. BMO Capital Markets cut their price target on Commercial Metals from $62.00 to $58.00 and set a “market perform” rating for the company in a report on Friday, January 3rd. BNP Paribas lowered shares of Commercial Metals from an “outperform” rating to a “neutral” rating in a research note on Friday, January 3rd. Finally, Jefferies Financial Group decreased their price objective on Commercial Metals from $65.00 to $62.00 and set a “buy” rating on the stock in a report on Monday, January 6th. Six research analysts have rated the stock with a hold rating and three have given a buy rating to the company. According to MarketBeat.com, the company has an average rating of “Hold” and an average price target of $61.83.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently made changes to their positions in the company. Park Square Financial Group LLC acquired a new stake in Commercial Metals in the fourth quarter valued at $33,000. Heck Capital Advisors LLC bought a new position in shares of Commercial Metals during the fourth quarter worth about $34,000. V Square Quantitative Management LLC lifted its stake in shares of Commercial Metals by 60.7% in the fourth quarter. V Square Quantitative Management LLC now owns 707 shares of the basic materials company’s stock worth $35,000 after acquiring an additional 267 shares during the period. South Plains Financial Inc. acquired a new stake in Commercial Metals during the 4th quarter valued at approximately $73,000. Finally, Jones Financial Companies Lllp lifted its position in shares of Commercial Metals by 22.0% in the 4th quarter. Jones Financial Companies Lllp now owns 1,646 shares of the basic materials company’s stock worth $82,000 after purchasing an additional 297 shares during the period. Institutional investors and hedge funds own 86.90% of the company’s stock.

Commercial Metals Stock Performance

The company has a debt-to-equity ratio of 0.29, a quick ratio of 1.94 and a current ratio of 2.76. The company has a market capitalization of $5.27 billion, a P/E ratio of 41.81, a price-to-earnings-growth ratio of 2.62 and a beta of 1.17. The stock’s 50 day moving average price is $48.88 and its 200 day moving average price is $52.81.

About Commercial Metals

Commercial Metals Company manufactures, recycles, and fabricates steel and metal products, and related materials and services in the United States, Poland, China, and internationally. It operates through two segments, North America and Europe. The company processes and sells ferrous and nonferrous scrap metals to steel mills and foundries, aluminum sheet and ingot manufacturers, brass and bronze ingot makers, copper refineries and mills, secondary lead smelters, specialty steel mills, high temperature alloy manufacturers, and other consumers.