COMMERCIAL METALS CO (CMC)
US2017231034 - Common Stock
Taking everything into account, CMC scores 6 out of 10 in our fundamental rating. CMC was compared to 155 industry peers in the Metals & Mining industry. Both the health and profitability get an excellent rating, making CMC a very profitable company, without any liquidiy or solvency issues. CMC has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
CMC had positive earnings in the past year.
In the past year CMC had a positive cash flow from operations.
CMC had positive earnings in each of the past 5 years.
CMC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
CMC has a better Return On Assets (7.12%) than 80.00% of its industry peers.
CMC has a better Return On Equity (11.29%) than 80.00% of its industry peers.
Looking at the Return On Invested Capital, with a value of 8.87%, CMC belongs to the top of the industry, outperforming 81.29% of the companies in the same industry.
CMC had an Average Return On Invested Capital over the past 3 years of 15.00%. This is significantly above the industry average of 8.82%.
The 3 year average ROIC (15.00%) for CMC is well above the current ROIC(8.87%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.12% | ||
| ROE | 11.29% | ||
| ROIC | 8.87% |
ROA(3y)13.2%
ROA(5y)11.07%
ROE(3y)23.07%
ROE(5y)20.4%
ROIC(3y)15%
ROIC(5y)13.7%
1.3 Margins
CMC has a better Profit Margin (6.13%) than 74.84% of its industry peers.
CMC's Profit Margin has improved in the last couple of years.
CMC's Operating Margin of 8.75% is fine compared to the rest of the industry. CMC outperforms 63.23% of its industry peers.
In the last couple of years the Operating Margin of CMC has grown nicely.
CMC has a Gross Margin of 17.14%. This is comparable to the rest of the industry: CMC outperforms 52.26% of its industry peers.
In the last couple of years the Gross Margin of CMC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.75% | ||
| PM (TTM) | 6.13% | ||
| GM | 17.14% |
OM growth 3Y-1.14%
OM growth 5Y5.51%
PM growth 3Y-0.05%
PM growth 5Y12.5%
GM growth 3Y1.42%
GM growth 5Y4.5%
2. Health
2.1 Basic Checks
CMC has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
CMC has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, CMC has less shares outstanding
Compared to 1 year ago, CMC has a worse debt to assets ratio.
2.2 Solvency
CMC has an Altman-Z score of 4.23. This indicates that CMC is financially healthy and has little risk of bankruptcy at the moment.
CMC's Altman-Z score of 4.23 is fine compared to the rest of the industry. CMC outperforms 66.45% of its industry peers.
CMC has a debt to FCF ratio of 2.07. This is a good value and a sign of high solvency as CMC would need 2.07 years to pay back of all of its debts.
The Debt to FCF ratio of CMC (2.07) is better than 76.77% of its industry peers.
A Debt/Equity ratio of 0.27 indicates that CMC is not too dependend on debt financing.
CMC has a worse Debt to Equity ratio (0.27) than 61.29% of its industry peers.
Even though the debt/equity ratio score it not favorable for CMC, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.27 | ||
| Debt/FCF | 2.07 | ||
| Altman-Z | 4.23 |
ROIC/WACC0.83
WACC10.64%
2.3 Liquidity
A Current Ratio of 3.94 indicates that CMC has no problem at all paying its short term obligations.
CMC has a better Current ratio (3.94) than 73.55% of its industry peers.
CMC has a Quick Ratio of 2.78. This indicates that CMC is financially healthy and has no problem in meeting its short term obligations.
With a decent Quick ratio value of 2.78, CMC is doing good in the industry, outperforming 69.68% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.94 | ||
| Quick Ratio | 2.78 |
3. Growth
3.1 Past
CMC shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -40.05%.
The Earnings Per Share has been growing by 16.44% on average over the past years. This is quite good.
The Revenue has decreased by -9.93% in the past year.
Measured over the past years, CMC shows a small growth in Revenue. The Revenue has been growing by 6.34% on average per year.
EPS 1Y (TTM)-40.05%
EPS 3Y7.76%
EPS 5Y16.44%
EPS Q2Q%-46.75%
Revenue 1Y (TTM)-9.93%
Revenue growth 3Y5.6%
Revenue growth 5Y6.34%
Sales Q2Q%-9.64%
3.2 Future
Based on estimates for the next years, CMC will show a small growth in Earnings Per Share. The EPS will grow by 3.83% on average per year.
CMC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.86% yearly.
EPS Next Y-11.62%
EPS Next 2Y3.54%
EPS Next 3Y3.83%
EPS Next 5YN/A
Revenue Next Year0.16%
Revenue Next 2Y4.54%
Revenue Next 3Y4.86%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 11.53 indicates a reasonable valuation of CMC.
CMC's Price/Earnings ratio is rather cheap when compared to the industry. CMC is cheaper than 83.87% of the companies in the same industry.
CMC is valuated cheaply when we compare the Price/Earnings ratio to 27.55, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 13.04 indicates a correct valuation of CMC.
65.16% of the companies in the same industry are more expensive than CMC, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 24.00, CMC is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.53 | ||
| Fwd PE | 13.04 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CMC indicates a somewhat cheap valuation: CMC is cheaper than 76.13% of the companies listed in the same industry.
89.03% of the companies in the same industry are more expensive than CMC, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.12 | ||
| EV/EBITDA | 6.25 |
4.3 Compensation for Growth
The excellent profitability rating of CMC may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.7
EPS Next 2Y3.54%
EPS Next 3Y3.83%
5. Dividend
5.1 Amount
CMC has a Yearly Dividend Yield of 1.45%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.22, CMC pays a bit more dividend than its industry peers.
Compared to the average S&P500 Dividend Yield of 2.36, CMC is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.45% |
5.2 History
The dividend of CMC is nicely growing with an annual growth rate of 7.29%!
CMC has been paying a dividend for at least 10 years, so it has a reliable track record.
CMC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)7.29%
Div Incr Years4
Div Non Decr Years13
5.3 Sustainability
CMC pays out 16.24% of its income as dividend. This is a sustainable payout ratio.
CMC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP16.24%
EPS Next 2Y3.54%
EPS Next 3Y3.83%
COMMERCIAL METALS CO
NYSE:CMC (12/26/2024, 5:59:16 PM)
After market: 51.07 0 (0%)51.07
+0.57 (+1.13%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryMetals & Mining
Earnings (Last)
Earnings (Next)
Inst Owners90.91%
Inst Owner Change-2.16%
Ins Owners0.47%
Ins Owner Change3.63%
Market Cap5.82B
Analysts76.92
Price Target64.26 (25.83%)
Short Float %2.81%
Short Ratio3.66
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.45% |
Dividend Growth(5Y)7.29%
DP16.24%
Div Incr Years4
Div Non Decr Years13
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.1%
Min EPS beat(2)-0.11%
Max EPS beat(2)0.3%
EPS beat(4)3
Avg EPS beat(4)7.08%
Min EPS beat(4)-0.11%
Max EPS beat(4)16.86%
EPS beat(8)6
Avg EPS beat(8)6.37%
EPS beat(12)10
Avg EPS beat(12)11.29%
EPS beat(16)13
Avg EPS beat(16)10.81%
Revenue beat(2)1
Avg Revenue beat(2)0.28%
Min Revenue beat(2)-1.23%
Max Revenue beat(2)1.79%
Revenue beat(4)3
Avg Revenue beat(4)1.9%
Min Revenue beat(4)-1.23%
Max Revenue beat(4)5.15%
Revenue beat(8)7
Avg Revenue beat(8)1.67%
Revenue beat(12)9
Avg Revenue beat(12)1.29%
Revenue beat(16)11
Avg Revenue beat(16)1.41%
PT rev (1m)-0.66%
PT rev (3m)-0.53%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-26.16%
EPS NY rev (1m)-1.94%
EPS NY rev (3m)-19.12%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-5.69%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)-2.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.53 | ||
| Fwd PE | 13.04 | ||
| P/S | 0.73 | ||
| P/FCF | 10.12 | ||
| P/OCF | 6.47 | ||
| P/B | 1.35 | ||
| P/tB | 1.58 | ||
| EV/EBITDA | 6.25 |
EPS(TTM)4.43
EY8.67%
EPS(NY)3.92
Fwd EY7.67%
FCF(TTM)5.05
FCFY9.88%
OCF(TTM)7.89
OCFY15.45%
SpS69.51
BVpS37.71
TBVpS32.27
PEG (NY)N/A
PEG (5Y)0.7
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.12% | ||
| ROE | 11.29% | ||
| ROCE | 11.59% | ||
| ROIC | 8.87% | ||
| ROICexc | 10.35% | ||
| ROICexgc | 11.78% | ||
| OM | 8.75% | ||
| PM (TTM) | 6.13% | ||
| GM | 17.14% | ||
| FCFM | 7.26% |
ROA(3y)13.2%
ROA(5y)11.07%
ROE(3y)23.07%
ROE(5y)20.4%
ROIC(3y)15%
ROIC(5y)13.7%
ROICexc(3y)17.18%
ROICexc(5y)15.83%
ROICexgc(3y)19.56%
ROICexgc(5y)17.4%
ROCE(3y)19.6%
ROCE(5y)17.94%
ROICexcg growth 3Y-7.72%
ROICexcg growth 5Y2.01%
ROICexc growth 3Y-10.89%
ROICexc growth 5Y-0.05%
OM growth 3Y-1.14%
OM growth 5Y5.51%
PM growth 3Y-0.05%
PM growth 5Y12.5%
GM growth 3Y1.42%
GM growth 5Y4.5%
F-Score5
Asset Turnover1.16
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.27 | ||
| Debt/FCF | 2.07 | ||
| Debt/EBITDA | 1.18 | ||
| Cap/Depr | 115.66% | ||
| Cap/Sales | 4.09% | ||
| Interest Coverage | 14.02 | ||
| Cash Conversion | 92.38% | ||
| Profit Quality | 118.53% | ||
| Current Ratio | 3.94 | ||
| Quick Ratio | 2.78 | ||
| Altman-Z | 4.23 |
F-Score5
WACC10.64%
ROIC/WACC0.83
Cap/Depr(3y)216.7%
Cap/Depr(5y)174.63%
Cap/Sales(3y)5.34%
Cap/Sales(5y)4.44%
Profit Quality(3y)74.95%
Profit Quality(5y)90.31%
High Growth Momentum
Growth
EPS 1Y (TTM)-40.05%
EPS 3Y7.76%
EPS 5Y16.44%
EPS Q2Q%-46.75%
EPS Next Y-11.62%
EPS Next 2Y3.54%
EPS Next 3Y3.83%
EPS Next 5YN/A
Revenue 1Y (TTM)-9.93%
Revenue growth 3Y5.6%
Revenue growth 5Y6.34%
Sales Q2Q%-9.64%
Revenue Next Year0.16%
Revenue Next 2Y4.54%
Revenue Next 3Y4.86%
Revenue Next 5YN/A
EBIT growth 1Y-40.62%
EBIT growth 3Y4.4%
EBIT growth 5Y12.2%
EBIT Next Year41.69%
EBIT Next 3Y18.58%
EBIT Next 5YN/A
FCF growth 1Y-21.96%
FCF growth 3Y135.07%
FCF growth 5YN/A
OCF growth 1Y-33.06%
OCF growth 3Y57.91%
OCF growth 5Y89.31%