COMMERCIAL METALS CO (CMC) Stock Fundamental Analysis
NYSE:CMC - New York Stock Exchange, Inc. - US2017231034 - Common Stock - Currency: USD
Overall CMC gets a fundamental rating of 6 out of 10. We evaluated CMC against 154 industry peers in the Metals & Mining industry. CMC has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. CMC has a valuation in line with the averages, 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.
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
With a decent Return On Assets value of 1.09%, CMC is doing good in the industry, outperforming 61.29% of the companies in the same industry.
CMC has a Return On Equity of 1.82%. This is comparable to the rest of the industry: CMC outperforms 60.00% of its industry peers.
CMC has a Return On Invested Capital of 7.00%. This is in the better half of the industry: CMC outperforms 71.61% of its industry peers.
The Average Return On Invested Capital over the past 3 years for CMC is above the industry average of 11.16%.
The last Return On Invested Capital (7.00%) 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 | 1.09% | ||
| ROE | 1.82% | ||
| ROIC | 7% |
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
The Profit Margin of CMC (0.94%) is better than 62.58% of its industry peers.
CMC's Profit Margin has improved in the last couple of years.
CMC's Operating Margin of 6.60% is in line compared to the rest of the industry. CMC outperforms 59.35% of its industry peers.
CMC's Operating Margin has improved in the last couple of years.
CMC has a Gross Margin (15.39%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of CMC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.6% | ||
| PM (TTM) | 0.94% | ||
| GM | 15.39% |
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.
CMC has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, CMC has less shares outstanding
The debt/assets ratio for CMC is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 3.91 indicates that CMC is not in any danger for bankruptcy at the moment.
CMC's Altman-Z score of 3.91 is fine compared to the rest of the industry. CMC outperforms 67.74% of its industry peers.
CMC has a debt to FCF ratio of 2.80. This is a good value and a sign of high solvency as CMC would need 2.80 years to pay back of all of its debts.
CMC has a Debt to FCF ratio of 2.80. This is in the better half of the industry: CMC outperforms 78.06% of its industry peers.
A Debt/Equity ratio of 0.29 indicates that CMC is not too dependend on debt financing.
The Debt to Equity ratio of CMC (0.29) is worse than 60.65% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 2.8 | ||
| Altman-Z | 3.91 |
ROIC/WACC0.82
WACC8.52%
2.3 Liquidity
CMC has a Current Ratio of 2.82. This indicates that CMC is financially healthy and has no problem in meeting its short term obligations.
CMC's Current ratio of 2.82 is fine compared to the rest of the industry. CMC outperforms 63.23% of its industry peers.
CMC has a Quick Ratio of 1.94. This is a normal value and indicates that CMC is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.94, CMC is in the better half of the industry, outperforming 61.29% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.82 | ||
| Quick Ratio | 1.94 |
3. Growth
3.1 Past
CMC shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -52.41%.
CMC shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 16.44% yearly.
The Revenue has decreased by -7.93% 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)-52.41%
EPS 3Y7.76%
EPS 5Y16.44%
EPS Q2Q%-70.45%
Revenue 1Y (TTM)-7.93%
Revenue growth 3Y5.6%
Revenue growth 5Y6.34%
Sales Q2Q%-5.08%
3.2 Future
The Earnings Per Share is expected to decrease by -0.08% on average over the next years.
CMC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.83% yearly.
EPS Next Y-33.23%
EPS Next 2Y-2.28%
EPS Next 3Y-0.08%
EPS Next 5YN/A
Revenue Next Year-1.82%
Revenue Next 2Y3.04%
Revenue Next 3Y3.83%
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.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
CMC is valuated correctly with a Price/Earnings ratio of 16.45.
CMC's Price/Earnings ratio is rather cheap when compared to the industry. CMC is cheaper than 81.29% of the companies in the same industry.
When comparing the Price/Earnings ratio of CMC to the average of the S&P500 Index (26.35), we can say CMC is valued slightly cheaper.
A Price/Forward Earnings ratio of 11.51 indicates a reasonable valuation of CMC.
Based on the Price/Forward Earnings ratio, CMC is valued a bit cheaper than the industry average as 68.39% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of CMC to the average of the S&P500 Index (22.19), we can say CMC is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.45 | ||
| Fwd PE | 11.51 |
4.2 Price Multiples
CMC's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. CMC is cheaper than 79.35% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, CMC is valued cheaper than 89.03% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.88 | ||
| EV/EBITDA | 7.48 |
4.3 Compensation for Growth
CMC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1
EPS Next 2Y-2.28%
EPS Next 3Y-0.08%
5. Dividend
5.1 Amount
CMC has a Yearly Dividend Yield of 1.47%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.98, CMC pays a bit more dividend than its industry peers.
CMC's Dividend Yield is slightly below the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.47% |
5.2 History
The dividend of CMC is nicely growing with an annual growth rate of 7.29%!
CMC has paid a dividend for at least 10 years, which is a reliable track record.
CMC has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)7.29%
Div Incr Years4
Div Non Decr Years13
5.3 Sustainability
112.78% of the earnings are spent on dividend by CMC. This is not a sustainable payout ratio.
The Dividend Rate of CMC has been growing, while earnings will be declining. This means the dividend growth is most likely not sustainable.
DP112.78%
EPS Next 2Y-2.28%
EPS Next 3Y-0.08%
48.68
-0.36 (-0.73%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryMetals & Mining
Earnings (Last)
Earnings (Next)
Inst Owners93.94%
Inst Owner Change1.6%
Ins Owners0.57%
Ins Owner Change0.68%
Market Cap5.50B
Analysts74.12
Price Target53.19 (9.26%)
Short Float %3.94%
Short Ratio4.43
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.47% |
Yearly Dividend0.68
Dividend Growth(5Y)7.29%
DP112.78%
Div Incr Years4
Div Non Decr Years13
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-6.93%
Min EPS beat(2)-10.99%
Max EPS beat(2)-2.86%
EPS beat(4)1
Avg EPS beat(4)-3.41%
Min EPS beat(4)-10.99%
Max EPS beat(4)0.3%
EPS beat(8)4
Avg EPS beat(8)2.73%
EPS beat(12)8
Avg EPS beat(12)6.34%
EPS beat(16)11
Avg EPS beat(16)8.99%
Revenue beat(2)1
Avg Revenue beat(2)0.06%
Min Revenue beat(2)-0.49%
Max Revenue beat(2)0.61%
Revenue beat(4)2
Avg Revenue beat(4)0.17%
Min Revenue beat(4)-1.23%
Max Revenue beat(4)1.79%
Revenue beat(8)6
Avg Revenue beat(8)1.44%
Revenue beat(12)9
Avg Revenue beat(12)1.43%
Revenue beat(16)11
Avg Revenue beat(16)1.3%
PT rev (1m)-0.03%
PT rev (3m)-10.41%
EPS NQ rev (1m)-0.12%
EPS NQ rev (3m)-8.81%
EPS NY rev (1m)0.04%
EPS NY rev (3m)-7.6%
Revenue NQ rev (1m)0.05%
Revenue NQ rev (3m)0.34%
Revenue NY rev (1m)-0.18%
Revenue NY rev (3m)0.83%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.45 | ||
| Fwd PE | 11.51 | ||
| P/S | 0.71 | ||
| P/FCF | 12.88 | ||
| P/OCF | 6.92 | ||
| P/B | 1.37 | ||
| P/tB | 1.61 | ||
| EV/EBITDA | 7.48 |
EPS(TTM)2.96
EY6.08%
EPS(NY)4.23
Fwd EY8.69%
FCF(TTM)3.78
FCFY7.77%
OCF(TTM)7.04
OCFY14.46%
SpS68.48
BVpS35.5
TBVpS30.16
PEG (NY)N/A
PEG (5Y)1
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.09% | ||
| ROE | 1.82% | ||
| ROCE | 9.15% | ||
| ROIC | 7% | ||
| ROICexc | 8.1% | ||
| ROICexgc | 9.26% | ||
| OM | 6.6% | ||
| PM (TTM) | 0.94% | ||
| GM | 15.39% | ||
| FCFM | 5.52% |
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 | 2.8 | ||
| Debt/EBITDA | 1.45 | ||
| Cap/Depr | 129.6% | ||
| Cap/Sales | 4.75% | ||
| Interest Coverage | 10.11 | ||
| Cash Conversion | 100.11% | ||
| Profit Quality | 584.2% | ||
| Current Ratio | 2.82 | ||
| Quick Ratio | 1.94 | ||
| Altman-Z | 3.91 |
F-Score4
WACC8.52%
ROIC/WACC0.82
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)-52.41%
EPS 3Y7.76%
EPS 5Y16.44%
EPS Q2Q%-70.45%
EPS Next Y-33.23%
EPS Next 2Y-2.28%
EPS Next 3Y-0.08%
EPS Next 5YN/A
Revenue 1Y (TTM)-7.93%
Revenue growth 3Y5.6%
Revenue growth 5Y6.34%
Sales Q2Q%-5.08%
Revenue Next Year-1.82%
Revenue Next 2Y3.04%
Revenue Next 3Y3.83%
Revenue Next 5YN/A
EBIT growth 1Y-45.47%
EBIT growth 3Y4.4%
EBIT growth 5Y12.2%
EBIT Next Year16.5%
EBIT Next 3Y13.35%
EBIT Next 5Y8%
FCF growth 1Y-34.99%
FCF growth 3Y135.07%
FCF growth 5YN/A
OCF growth 1Y-34%
OCF growth 3Y57.91%
OCF growth 5Y89.31%