Back to top

Image: Bigstock

What's in Store for Commercial Metals (CMC) in Q2 Earnings?

Read MoreHide Full Article

Commercial Metals Company (CMC - Free Report) is scheduled to report second-quarter fiscal 2023 results on Mar 23, before the opening bell.

Fiscal Q2 Estimates

The Zacks Consensus Estimate for fiscal second-quarter revenues is pegged at $1.91 billion, indicating a 5.1% decline from the prior-year quarter’s reported figure. The same for earnings is pegged at $1.50 per share, implying a 1.9% decline from the year-ago period.

Fiscal Q1 Performance

In the last reported quarter, the company’s top and bottom lines beat the Zacks Consensus Estimate. Both earnings and revenues improved year over year.

The company has a trailing four-quarter average earnings surprise of 16.7%.

Key Factors to Consider

Robust demand in North America for each of Commercial Metals’ major product lines is expected to benefit the company's fiscal second-quarter 2023 results. In the to-be-reported quarter, North America segment’s volumes are expected to have been driven by current and new reshoring projects, and rising levels of infrastructure spending.

High contract backlog volumes and average pricing are also expected to have boosted CMC’s performance. Commercial Metals has been implementing price rises across its mill products in response to rapidly rising scrap costs, which is likely to have sustained margins in the to-be-reported quarter.

However, economic uncertainty is expected to have an impact on Europe segment’s volumes. Higher energy costs, lower receipt of CO2 energy credit and the weakening of the Polish zloty in relation to the U.S. dollar are also expected to have impacted the Europe segment’s margin.

Steel volumes in North America are likely to have followed typical seasonal patterns in the second quarter of fiscal 2023, with a modest decline from first-quarter levels. Higher scrap margins on steel products in both North America and Europe might impact the company’s results.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for Commercial Metals this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the chances of an earnings beat. However, that’s not the case here.

You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Earnings ESP: The Earnings ESP for Commercial Metals is -3.55%.

Zacks Rank: Commercial Metals currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank stocks here.

Price Performance

Commercial Metal’s shares have gained 12.9% in the past year compared with the industry’s growth of 9.8%.

Zacks Investment Research
Image Source: Zacks Investment Research

Stocks Worth a Look

Here are some stocks that have the right combination of elements to post an earnings beat in their upcoming releases.

PDD Holdings Inc. (PDD - Free Report) has an Earnings ESP of +0.42% and currently sports a Zacks Rank #1. The company is slated to report fourth-quarter 2022 results on Mar 20. It has a trailing four-quarter earnings surprise of 174.3%, on average.

The Zacks Consensus Estimate for PDD’s fourth-quarter earnings is pegged at $3.96 per share, implying a year-over-year increase of 164%. Revenue estimates are pegged at $18.78 billion, indicating a 28.9% increase from the year-ago quarter.

Canadian Solar Inc. (CSIQ - Free Report) has an Earnings ESP of +102.76% and currently carries a Zacks Rank #2. The company is expected to report fourth-quarter 2022 results on Mar 21. It has a trailing four-quarter earnings surprise of 117.6%, on average.

The Zacks Consensus Estimate for CSIQ’s fourth-quarter earnings is pegged at $2.74 per share, indicating a year-over-year increase of 142.3%. The same for revenues is pegged at $7.38 billion, indicating a year-over-year increase of 39.1%.

Amadeus IT Group, S.A. (AMADY - Free Report) is slated to report fourth-quarter 2022 results on Mar 17. The company has an Earnings ESP of +12.94% and a Zacks Rank #3 at present.

The Zacks Consensus Estimate for AMADY’s fourth-quarter earnings is pegged at $1.74 per share, indicating an increase of 1533.3% from the year-ago quarter’s figure. Quarterly revenues are estimated to increase 47.5% year over year to $4.65 billion.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

Published in