Commercial Metals Company (CMC - Free Report) reported adjusted earnings per share (EPS) of $2.45 for fourth-quarter fiscal 2022 (ended Aug 31, 2022), beating the Zacks Consensus Estimate of $2.23. The bottom line surged 94% from the prior-year fiscal quarter’s earnings per share of $1.26.
Including one-time items, CMC achieved an EPS of $2.40 in the quarter compared with the prior-year fiscal quarter’s $1.24.
Net sales in the reported quarter came in at $2,407 million compared with the year-ago fiscal quarter’s $2,030 million. The reported figure surpassed the Zacks Consensus Estimate of $2,382 million.
The cost of goods sold in the quarter was up 12.6% from the year-ago fiscal quarter’s reading to $1,899 million. The gross profit was up 48% from the year-ago fiscal quarter’s level to $508 million during this period. The core EBITDA was $419 million in the fiscal fourth quarter, up 64% from the year-ago fiscal quarter’s number. It was the second-highest figure reported in CMC’s history.
Segmental Performance
The North America segment generated net sales of $1,998 million in the fiscal fourth quarter compared with $1,660 million in the prior-year quarter. The segment registered an adjusted EBITDA of $370 million compared with the year-earlier quarter’s $212 million.
The Europe segment’s revenues came in at $412 million, gaining 12% above the year-ago fiscal quarter’s figure. The adjusted EBITDA was $64 million in the fiscal fourth quarter, down 5% from the year-ago fiscal quarter’s $68 million.
Fiscal 2022 Performance
Commercial Metals reported adjusted earnings per share of $8.19 for fiscal 2022, marking a 132% surge from the prior year’s figure of $3.53. The bottom line beat the Zacks Consensus Estimate of $7.98. Including one-time items, EPS was $9.95 in fiscal 2022 compared with $3.38 in fiscal 2021. Revenues improved 32% year over year to $8.9 billion in fiscal 2022, in line with the Zacks Consensus Estimate.
Financials
Commercial Metals reported cash and cash equivalents of $672 million at the end of fiscal 2022 compared with $498 million at the end of fiscal 2021. CMC’s long-term debt came in at $1,113 million at the end of fiscal 2022 compared with $1,015 million at fiscal 2021 end. Cash generated from operating activities was $700 million in fiscal 2022 compared with $228 million in the last fiscal year.
CMC repurchased shares worth $106.3 million in the quarter under review. As of Aug 31, 2022, $188.1 million remained under the current share buyback authorization. CMC also recently raised its quarterly dividend 14% to 16 cents per share.
In the fiscal third quarter, Commercial Metals completed the acquisition of Tensar Corporation. This buyout adds a highly attractive new growth platform to CMC, making it a unique provider of value-added reinforcement solutions for the domestic and international construction markets.
Outlook
Commercial Metals noted that contract backlog volumes and average pricing are at historical highs. It expects sustained robust demand for each of its major product lines in North America during first quarter of fiscal 2023. Finished steel volumes are expected to follow typical seasonal patterns. Market conditions in Europe remain uncertain against the backdrop of the ongoing energy crisis and slowing industrial activity.
Price Performance
Shares of Commercial Metals have gained 32.7% in the past year against the industry’s decline of 20.3%.
Zacks Rank & Stocks to Consider
Commercial Metals currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the basic materials space are Albemarle Corporation (ALB - Free Report) , ATI Inc. (ATI - Free Report) and Veritiv Corporation , each currently flaunting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Albemarle has a projected earnings growth rate of 427% for the current year. The Zacks Consensus Estimate for ALB's current-year earnings has been revised 19% upward in the past 60 days.
ALB’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average being 24.2%. The stock has gained around 11.9% in the past year.
ATI, currently flaunting a Zacks Rank of 1, has an expected earnings growth rate of 1,454% for the current year. The consensus estimate for ATI’s current-year earnings has been revised 23% upward in the past 60 days.
ATI’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average being 130.4%. ATI has gained 61.4% over the past year.
Veritiv has a projected earnings growth rate of 136% for the current year. The Zacks Consensus Estimate for VRTV’s current-year earnings has been revised 15% upward in the past 60 days.
Veritiv has a trailing four-quarter earnings surprise of 36.9%. VRTV has gained roughly 8% in a year’s time.
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Commercial Metals Company (CMC - Free Report) reported adjusted earnings per share (EPS) of $2.45 for fourth-quarter fiscal 2022 (ended Aug 31, 2022), beating the Zacks Consensus Estimate of $2.23. The bottom line surged 94% from the prior-year fiscal quarter’s earnings per share of $1.26.
Including one-time items, CMC achieved an EPS of $2.40 in the quarter compared with the prior-year fiscal quarter’s $1.24.
Net sales in the reported quarter came in at $2,407 million compared with the year-ago fiscal quarter’s $2,030 million. The reported figure surpassed the Zacks Consensus Estimate of $2,382 million.
The cost of goods sold in the quarter was up 12.6% from the year-ago fiscal quarter’s reading to $1,899 million. The gross profit was up 48% from the year-ago fiscal quarter’s level to $508 million during this period. The core EBITDA was $419 million in the fiscal fourth quarter, up 64% from the year-ago fiscal quarter’s number. It was the second-highest figure reported in CMC’s history.
Segmental Performance
The North America segment generated net sales of $1,998 million in the fiscal fourth quarter compared with $1,660 million in the prior-year quarter. The segment registered an adjusted EBITDA of $370 million compared with the year-earlier quarter’s $212 million.
The Europe segment’s revenues came in at $412 million, gaining 12% above the year-ago fiscal quarter’s figure. The adjusted EBITDA was $64 million in the fiscal fourth quarter, down 5% from the year-ago fiscal quarter’s $68 million.
Fiscal 2022 Performance
Commercial Metals reported adjusted earnings per share of $8.19 for fiscal 2022, marking a 132% surge from the prior year’s figure of $3.53. The bottom line beat the Zacks Consensus Estimate of $7.98. Including one-time items, EPS was $9.95 in fiscal 2022 compared with $3.38 in fiscal 2021. Revenues improved 32% year over year to $8.9 billion in fiscal 2022, in line with the Zacks Consensus Estimate.
Financials
Commercial Metals reported cash and cash equivalents of $672 million at the end of fiscal 2022 compared with $498 million at the end of fiscal 2021. CMC’s long-term debt came in at $1,113 million at the end of fiscal 2022 compared with $1,015 million at fiscal 2021 end. Cash generated from operating activities was $700 million in fiscal 2022 compared with $228 million in the last fiscal year.
CMC repurchased shares worth $106.3 million in the quarter under review. As of Aug 31, 2022, $188.1 million remained under the current share buyback authorization. CMC also recently raised its quarterly dividend 14% to 16 cents per share.
In the fiscal third quarter, Commercial Metals completed the acquisition of Tensar Corporation. This buyout adds a highly attractive new growth platform to CMC, making it a unique provider of value-added reinforcement solutions for the domestic and international construction markets.
Outlook
Commercial Metals noted that contract backlog volumes and average pricing are at historical highs. It expects sustained robust demand for each of its major product lines in North America during first quarter of fiscal 2023. Finished steel volumes are expected to follow typical seasonal patterns. Market conditions in Europe remain uncertain against the backdrop of the ongoing energy crisis and slowing industrial activity.
Price Performance
Shares of Commercial Metals have gained 32.7% in the past year against the industry’s decline of 20.3%.
Zacks Rank & Stocks to Consider
Commercial Metals currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the basic materials space are Albemarle Corporation (ALB - Free Report) , ATI Inc. (ATI - Free Report) and Veritiv Corporation , each currently flaunting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Albemarle has a projected earnings growth rate of 427% for the current year. The Zacks Consensus Estimate for ALB's current-year earnings has been revised 19% upward in the past 60 days.
ALB’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average being 24.2%. The stock has gained around 11.9% in the past year.
ATI, currently flaunting a Zacks Rank of 1, has an expected earnings growth rate of 1,454% for the current year. The consensus estimate for ATI’s current-year earnings has been revised 23% upward in the past 60 days.
ATI’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average being 130.4%. ATI has gained 61.4% over the past year.
Veritiv has a projected earnings growth rate of 136% for the current year. The Zacks Consensus Estimate for VRTV’s current-year earnings has been revised 15% upward in the past 60 days.
Veritiv has a trailing four-quarter earnings surprise of 36.9%. VRTV has gained roughly 8% in a year’s time.
4 Oil Stocks with Massive Upsides
Global demand for oil is through the roof... and oil producers are struggling to keep up. So even though oil prices are well off their recent highs, you can expect big profits from the companies that supply the world with "black gold."
Zacks Investment Research has just released an urgent special report to help you bank on this trend.
In Oil Market on Fire, you'll discover 4 unexpected oil and gas stocks positioned for big gains in the coming weeks and months. You don't want to miss these recommendations.
Download your free report now to see them.
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