Last Updated: 16 Sep 2024
Executive Summary
Commercial Metals Company (CMC) is a leading manufacturer and recycler of steel and metal products. The company has a strong market position, a diversified product portfolio, and a global presence. CMC's financial performance has been solid in recent years, with the company reporting strong revenue and earnings growth. The stock is currently trading at a discount to its fair value, making it an attractive investment opportunity.
Company Overview
CMC is headquartered in Irving, Texas, and has operations in the United States, Poland, China, Germany, and other countries. The company manufactures a wide range of steel and metal products, including rebar, wire rod, merchant bar, and structural shapes. CMC also recycles scrap metal and provides related services.
Fundamental Analysis
CMC's financial performance has been solid in recent years. The company reported revenue of $8.14 billion in fiscal 2023, up from $7.43 billion in fiscal 2022. Net income was $695 million in fiscal 2023, up from $587 million in fiscal 2022. Diluted EPS was $4.81 in fiscal 2023, up from $4.06 in fiscal 2022.
CMC's financial performance is expected to remain strong in fiscal 2024. The company is benefiting from strong demand for its products, particularly in the construction and automotive industries. CMC is also benefiting from its cost-cutting initiatives and its global presence.
Technical Analysis
CMC's stock price has been in a downtrend since early 2023. The stock is currently trading at $51.19, below its 50-day and 200-day moving averages. The stock's relative strength index (RSI) is also below 50, indicating that the stock is oversold.
The technical analysis suggests that CMC's stock price is likely to continue to decline in the short term. However, the stock's long-term outlook is positive.
Short Term Outlook
CMC's stock price is likely to continue to decline in the short term. The stock is currently trading below its 50-day and 200-day moving averages, and the RSI is below 50. This suggests that the stock is oversold and that there is further downside potential.
Long Term Outlook
CMC's long-term outlook is positive. The company is a leader in the steel industry, and it has a strong market position, a diversified product portfolio, and a global presence. CMC is also benefiting from strong demand for its products and its cost-cutting initiatives.
Analyst Recommendations
Analysts are generally positive on CMC's stock. The average analyst rating is "buy," and the average analyst target price is $63.43. This suggests that analysts believe that CMC's stock is undervalued and that it has the potential to appreciate in the long term.
