Analyzing Commercial Metals (CMC) & The Competition

Commercial Metals (NYSE:CMC) is one of 1,984 publicly-traded companies in the “Metals & Mining” industry, but how does it weigh in compared to its competitors? We will compare Commercial Metals to similar businesses based on the strength of its profitability, valuation, analyst recommendations, dividends, institutional ownership, risk and earnings.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Commercial Metals and its competitors, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Commercial Metals	1	4	10	0	2.60
Commercial Metals Competitors	6406	22609	32306	1801	2.47

Commercial Metals presently has a consensus price target of $78.73, indicating a potential upside of 26.44%. As a group, “Metals & Mining” companies have a potential upside of 27.85%. Given Commercial Metals’ competitors higher possible upside, analysts plainly believe Commercial Metals has less favorable growth aspects than its competitors.

Institutional and Insider Ownership

86.9% of Commercial Metals shares are held by institutional investors. Comparatively, 16.1% of shares of all “Metals & Mining” companies are held by institutional investors. 0.6% of Commercial Metals shares are held by company insiders. Comparatively, 17.6% of shares of all “Metals & Mining” companies are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Commercial Metals and its competitors top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Commercial Metals	$9.39 billion	$655.85 million	10.61
Commercial Metals Competitors	$4.77 billion	$278.94 million	-26.22

Commercial Metals has higher revenue and earnings than its competitors. Commercial Metals is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Volatility and Risk

Commercial Metals has a beta of 1.55, indicating that its stock price is 55% more volatile than the S&P 500. Comparatively, Commercial Metals’ competitors have a beta of 0.96, indicating that their average stock price is 4% less volatile than the S&P 500.

Dividends

Commercial Metals pays an annual dividend of $0.80 per share and has a dividend yield of 1.3%. Commercial Metals pays out 13.6% of its earnings in the form of a dividend. As a group, “Metals & Mining” companies pay a dividend yield of 10.3% and pay out 10.8% of their earnings in the form of a dividend. Commercial Metals has increased its dividend for 4 consecutive years. Commercial Metals lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Profitability

This table compares Commercial Metals and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Commercial Metals	6.98%	17.00%	7.85%
Commercial Metals Competitors	-1,164,884,689,320,590,400.00%	-52.78%	-2.01%

Summary

Commercial Metals beats its competitors on 10 of the 15 factors compared.

Commercial Metals Company Profile

Commercial Metals Company manufactures, recycles, and fabricates steel and metal products, and related materials and services in the United States, Poland, China, and internationally. It operates through two segments, North America and Europe. The company processes and sells ferrous and nonferrous scrap metals to steel mills and foundries, aluminum sheet and ingot manufacturers, brass and bronze ingot makers, copper refineries and mills, secondary lead smelters, specialty steel mills, high temperature alloy manufacturers, and other consumers. It also manufactures and sells finished long steel products, including reinforcing bar, merchant bar, light structural, and other special sections, as well as semi-finished billets for rerolling and forging applications. In addition, the company provides fabricated rebar used to reinforce concrete primarily in the construction of commercial and non-commercial buildings, hospitals, convention centers, industrial plants, power plants, highways, bridges, arenas, stadiums, and dams; sells and rents construction-related products and equipment to concrete installers and other businesses; and manufactures and sells strength bars for the truck trailer industry, special bar steels for the energy market, and armor plates for military vehicles. Further, it manufactures rebars, merchant bars, and wire rods; and sells fabricated rebars, wire meshes, fabricated meshes, assembled rebar cages, and other fabricated rebar by-products to fabricators, manufacturers, distributors, and construction companies. The company was founded in 1915 and is headquartered in Irving, Texas.