COMMERCIAL METALS CO (CMC) Stock Fundamental Analysis
NYSE:CMC - New York Stock Exchange, Inc. - US2017231034 - Common Stock - Currency: USD
CMC gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 152 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 is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year CMC was profitable.
CMC had a positive operating cash flow in the past year.
In the past 5 years CMC has always been profitable.
In the past 5 years CMC always reported a positive cash flow from operatings.
1.2 Ratios
CMC has a better Return On Assets (1.97%) than 62.76% of its industry peers.
Looking at the Return On Equity, with a value of 3.32%, CMC is in the better half of the industry, outperforming 62.07% of the companies in the same industry.
CMC has a better Return On Invested Capital (8.01%) than 80.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for CMC is significantly above the industry average of 8.75%.
The last Return On Invested Capital (8.01%) for CMC is well below the 3 year average (15.00%), which needs to be investigated, but indicates that CMC had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.97% | ||
| ROE | 3.32% | ||
| ROIC | 8.01% |
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's Profit Margin of 1.70% is fine compared to the rest of the industry. CMC outperforms 62.76% of its industry peers.
CMC's Profit Margin has improved in the last couple of years.
CMC has a Operating Margin of 7.50%. This is in the better half of the industry: CMC outperforms 61.38% of its industry peers.
In the last couple of years the Operating Margin of CMC has grown nicely.
With a Gross Margin value of 16.18%, CMC perfoms like the industry average, outperforming 48.97% of the companies in the same industry.
In the last couple of years the Gross Margin of CMC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.5% | ||
| PM (TTM) | 1.7% | ||
| GM | 16.18% |
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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), CMC is creating some value.
The number of shares outstanding for CMC has been reduced compared to 1 year ago.
CMC has less shares outstanding than it did 5 years ago.
CMC has a worse debt/assets ratio than last year.
2.2 Solvency
CMC has an Altman-Z score of 3.94. This indicates that CMC is financially healthy and has little risk of bankruptcy at the moment.
CMC has a better Altman-Z score (3.94) than 64.83% of its industry peers.
The Debt to FCF ratio of CMC is 2.49, which is a good value as it means it would take CMC, 2.49 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 2.49, CMC is doing good in the industry, outperforming 76.55% of the companies in the same industry.
CMC has a Debt/Equity ratio of 0.29. This is a healthy value indicating a solid balance between debt and equity.
With a Debt to Equity ratio value of 0.29, CMC is not doing good in the industry: 62.07% of the companies in the same industry are doing better.
Although CMC does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 2.49 | ||
| Altman-Z | 3.94 |
ROIC/WACC0.76
WACC10.5%
2.3 Liquidity
CMC has a Current Ratio of 2.76. This indicates that CMC is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of CMC (2.76) is comparable to the rest of the industry.
A Quick Ratio of 1.94 indicates that CMC should not have too much problems paying its short term obligations.
CMC has a Quick ratio of 1.94. This is in the better half of the industry: CMC outperforms 61.38% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.76 | ||
| Quick Ratio | 1.94 |
3. Growth
3.1 Past
The earnings per share for CMC have decreased strongly by -47.20% in the last year.
The Earnings Per Share has been growing by 16.44% on average over the past years. This is quite good.
Looking at the last year, CMC shows a decrease in Revenue. The Revenue has decreased by -8.66% in the last year.
The Revenue has been growing slightly by 6.34% on average over the past years.
EPS 1Y (TTM)-47.2%
EPS 3Y7.76%
EPS 5Y16.44%
EPS Q2Q%-52.15%
Revenue 1Y (TTM)-8.66%
Revenue growth 3Y5.6%
Revenue growth 5Y6.34%
Sales Q2Q%-4.67%
3.2 Future
The Earnings Per Share is expected to grow by 3.83% on average over the next years.
Based on estimates for the next years, CMC will show a small growth in Revenue. The Revenue will grow by 3.56% on average per year.
EPS Next Y-11.62%
EPS Next 2Y3.54%
EPS Next 3Y3.83%
EPS Next 5YN/A
Revenue Next Year-3.19%
Revenue Next 2Y2.9%
Revenue Next 3Y3.56%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
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 13.68 indicates a correct valuation of CMC.
Compared to the rest of the industry, the Price/Earnings ratio of CMC indicates a somewhat cheap valuation: CMC is cheaper than 79.31% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.51, CMC is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 10.32, the valuation of CMC can be described as reasonable.
Based on the Price/Forward Earnings ratio, CMC is valued a bit cheaper than the industry average as 73.79% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 93.88. CMC is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.68 | ||
| Fwd PE | 10.32 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CMC is valued a bit cheaper than the industry average as 73.79% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of CMC indicates a rather cheap valuation: CMC is cheaper than 87.59% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.73 | ||
| EV/EBITDA | 6.93 |
4.3 Compensation for Growth
CMC has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.83
EPS Next 2Y3.54%
EPS Next 3Y3.83%
5. Dividend
5.1 Amount
CMC has a Yearly Dividend Yield of 1.43%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.17, CMC pays a bit more dividend than its industry peers.
Compared to the average S&P500 Dividend Yield of 2.27, CMC is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.43% |
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 60.43% of its income as dividend. This is not a sustainable payout ratio.
CMC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP60.43%
EPS Next 2Y3.54%
EPS Next 3Y3.83%
COMMERCIAL METALS CO
NYSE:CMC (1/30/2025, 8:15:11 PM)
After market: 48.99 0 (0%)48.99
-0.92 (-1.84%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryMetals & Mining
Earnings (Last)
Earnings (Next)
Inst Owners90.91%
Inst Owner Change0.02%
Ins Owners0.47%
Ins Owner Change4.29%
Market Cap5.59B
Analysts73.33
Price Target65.28 (33.25%)
Short Float %3.24%
Short Ratio3.66
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.43% |
Yearly Dividend0.68
Dividend Growth(5Y)7.29%
DP60.43%
Div Incr Years4
Div Non Decr Years13
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-3.1%
Min EPS beat(2)-6.5%
Max EPS beat(2)0.3%
EPS beat(4)2
Avg EPS beat(4)2.64%
Min EPS beat(4)-6.5%
Max EPS beat(4)16.86%
EPS beat(8)5
Avg EPS beat(8)3.89%
EPS beat(12)9
Avg EPS beat(12)8.14%
EPS beat(16)12
Avg EPS beat(16)10.16%
Revenue beat(2)1
Avg Revenue beat(2)-0.1%
Min Revenue beat(2)-1.23%
Max Revenue beat(2)1.04%
Revenue beat(4)3
Avg Revenue beat(4)0.87%
Min Revenue beat(4)-1.23%
Max Revenue beat(4)1.89%
Revenue beat(8)7
Avg Revenue beat(8)1.75%
Revenue beat(12)10
Avg Revenue beat(12)1.77%
Revenue beat(16)11
Avg Revenue beat(16)1.3%
PT rev (1m)1.59%
PT rev (3m)0.92%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-31.48%
EPS NY rev (1m)0%
EPS NY rev (3m)-19.12%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.43%
Revenue NY rev (1m)-3.34%
Revenue NY rev (3m)-5.48%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.68 | ||
| Fwd PE | 10.32 | ||
| P/S | 0.71 | ||
| P/FCF | 11.73 | ||
| P/OCF | 6.56 | ||
| P/B | 1.39 | ||
| P/tB | 1.64 | ||
| EV/EBITDA | 6.93 |
EPS(TTM)3.58
EY7.31%
EPS(NY)4.75
Fwd EY9.69%
FCF(TTM)4.18
FCFY8.53%
OCF(TTM)7.47
OCFY15.25%
SpS68.69
BVpS35.21
TBVpS29.85
PEG (NY)N/A
PEG (5Y)0.83
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.97% | ||
| ROE | 3.32% | ||
| ROCE | 10.47% | ||
| ROIC | 8.01% | ||
| ROICexc | 9.46% | ||
| ROICexgc | 10.85% | ||
| OM | 7.5% | ||
| PM (TTM) | 1.7% | ||
| GM | 16.18% | ||
| FCFM | 6.08% |
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-Score4
Asset Turnover1.16
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 2.49 | ||
| Debt/EBITDA | 1.32 | ||
| Cap/Depr | 133.32% | ||
| Cap/Sales | 4.79% | ||
| Interest Coverage | 11.78 | ||
| Cash Conversion | 98.03% | ||
| Profit Quality | 356.71% | ||
| Current Ratio | 2.76 | ||
| Quick Ratio | 1.94 | ||
| Altman-Z | 3.94 |
F-Score4
WACC10.5%
ROIC/WACC0.76
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)-47.2%
EPS 3Y7.76%
EPS 5Y16.44%
EPS Q2Q%-52.15%
EPS Next Y-11.62%
EPS Next 2Y3.54%
EPS Next 3Y3.83%
EPS Next 5YN/A
Revenue 1Y (TTM)-8.66%
Revenue growth 3Y5.6%
Revenue growth 5Y6.34%
Sales Q2Q%-4.67%
Revenue Next Year-3.19%
Revenue Next 2Y2.9%
Revenue Next 3Y3.56%
Revenue Next 5YN/A
EBIT growth 1Y-44.24%
EBIT growth 3Y4.4%
EBIT growth 5Y12.2%
EBIT Next Year20.81%
EBIT Next 3Y13.35%
EBIT Next 5YN/A
FCF growth 1Y-10.82%
FCF growth 3Y135.07%
FCF growth 5YN/A
OCF growth 1Y-18.65%
OCF growth 3Y57.91%
OCF growth 5Y89.31%