Commercial Metals Company (NYSE:CMC) was downgraded by equities researchers at Bank of America Corp. to a "neutral" rating in a report released on Wednesday.
The analysts wrote, "We continue to think NUE represents a relatively attractive investment opportunity within our coverage, but expect limited catalysts on falling steel prices and more recent full valuation," analyst Timna Tanners wrote in a note.Related Link: Barclays Adjusts Price Targets On AK Steel, CONSOL Energy (NYSE:CNX) And OthersOn Thursday's second-quarter call, the analyst said investors will focus on how much spare capacity Nucor (NYSE:NUE) might be able to contribute to a relatively tight sheet market after the company reportedly operated at 105 percent of capacity at its sheet mills. "We expect benign market commentary, similar to STLD, although our channel checks indicate gaps of $145–200/t on delivered sheet imports relative to domestic prices. We would be keen for an update on NUE's plans for cash use given its also substantial cash hoard of $2.3 billion as of Q116," Tanners noted.Meanwhile, the analyst added that Nucor has more long products exposure than Steel Dynamics, but less than Commercial Metals Company (NYSE: CMC) at about 39 percent of 2015 sales, and has also been growing volumes in its fabricated segment.Looking Forward"NUE remains relatively defensive due to variable costs and LIFO earnings, which can help offset any hit from falling prices. It also tends to import scrap, so can benefit on the margin from a stronger dollar arbitrage on scrap costs," Tanners highlighted. That said, the analyst cut 2016 EPS view to reflect expected long product margin squeeze into the second quarter and lower volumes in the third. Tanners lowered 2016 EPS forecast to $2.40 from $2.45. The analyst also trimmed 2016 revenue estimate to $18.39 billion from $18.44 billion."Average selling prices can be supported for the near term from trailing contract prices, but we expect lower prices into Q4E on our view that lower global prices ultimately pressure a lofty U.S. premium lower,"
Several large investors recently modified their holdings of the stock. Springbok Capital Management LLC raised its stake in shares of Commercial Metals by 710.0% in the first quarter. Springbok Capital Management LLC now owns 8,100 shares of the company's stock worth $137,000 after buying an additional 7,100 shares during the period. Invictus RG bought a new stake in shares of Commercial Metals during the first quarter worth about $205,000. Eqis Capital Management Inc. bought a new stake in shares of Commercial Metals during the second quarter worth about $206,000. Acrospire Investment Management LLC bought a new stake in shares of Commercial Metals during the first quarter worth about $287,000. Finally, Nisa Investment Advisors LLC raised its stake in shares of Commercial Metals by 85.8% in the second quarter. Nisa Investment Advisors LLC now owns 18,950 shares of the company's stock worth $320,000 after buying an additional 8,750 shares during the period.
Commercial Metals (NYSE:CMC) traded down 1.70% during mid-day trading on Wednesday, hitting $16.75. The stock had a trading volume of 1,280,262 shares. The company has a 50-day moving average of $17.10 and a 200-day moving average of $16.07. The firm has a market cap of $1.92 billion and a PE ratio of 15.21. Commercial Metals has a 12-month low of $12.44 and a 12-month high of $18.50.
Commercial Metals (NYSE:CMC) last posted its quarterly earnings results on Thursday, June 23rd. The company reported $0.30 earnings per share (EPS) for the quarter, topping the Thomson Reuters' consensus estimate of $0.25 by $0.05. The business earned $1.23 billion during the quarter. The business's revenue was down 18.5% compared to the same quarter last year. During the same quarter last year, the business posted $0.58 EPS. Analysts expect that Commercial Metals will post $0.98 earnings per share for the current year.
The business also recently announced a quarterly dividend, which will be paid on Thursday, July 21st. Shareholders of record on Thursday, July 7th will be paid a dividend of $0.12 per share. This represents a $0.48 dividend on an annualized basis and a dividend yield of 2.87%. The ex-dividend date of this dividend is Tuesday, July 5th.
Other research analysts have also issued research reports about the stock. Jefferies Group restated a "buy" rating on shares of Commercial Metals in a research report on Saturday, June 4th. Zacks Investment Research upgraded shares of Commercial Metals from a "hold" rating to a "buy" rating and set a $19.00 price objective on the stock in a research report on Monday, May 30th. Credit Agricole SA cut shares of Commercial Metals from a "buy" rating to a "sell" rating and lowered their price objective for the stock from $17.00 to $15.00 in a research report on Monday, March 28th. Clarkson Capital cut shares of Commercial Metals from a "neutral" rating to a "sell" rating in a research report on Monday, June 27th. Finally, Credit Suisse Group AG lowered their price objective on shares of Commercial Metals from $16.00 to $15.00 and set a "neutral" rating on the stock in a research report on Monday, March 28th. Two research analysts have rated the stock with a sell rating, four have assigned a hold rating and two have issued a buy rating to the company. Commercial Metals has an average rating of "Hold" and a consensus target price of $16.79.
In other Commercial Metals news, Director Anthony A. Massaro sold 2,367 shares of Commercial Metals stock in a transaction on Tuesday, July 5th. The shares were sold at an average price of $16.36, for a total transaction of $38,724.12. Following the completion of the sale, the director now owns 69,252 shares of the company's stock, valued at approximately $1,132,962.72. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, VP Paul K. Kirkpatrick sold 2,500 shares of Commercial Metals stock in a transaction on Friday, April 22nd. The shares were sold at an average price of $18.20, for a total transaction of $45,500.00. Following the sale, the vice president now directly owns 43,481 shares of the company's stock, valued at approximately $791,354.20. The disclosure for this sale can be found here.
Commercial Metals Company (CMC) manufactures, recycles and markets steel and metal products, related materials and services. CMC has a network of steel mills (minimills), steel fabrication and processing facilities, warehouses, metal recycling facilities. It has five business segments: Americas Recycling, Americas Mills, Americas Fabrication, International Mill, and International Marketing and Distribution.