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What's in Store for Commercial Metals (CMC) in Q4 Earnings?
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Commercial Metals Company (CMC - Free Report) is expected to report declines in the top and bottom lines in its fourth-quarter fiscal 2023 results. While the robust demand in North America for Commercial Metals’ major product lines is expected to get reflected in the results, the low demand in Europe is likely to have negated these gains.
Q4 Estimates
The Zacks Consensus Estimate for fiscal fourth-quarter revenues is pegged at $2.09 billion, indicating a 13% decline from the prior-year quarter’s reported figure. The same for earnings is pegged at $1.88 per share, implying a 23.3% decline from the year-ago period.
Q3 Performance
In the last reported quarter, the company’s top and bottom lines beat the Zacks Consensus Estimate. However, both earnings and revenues declined year over year. The company has a trailing four-quarter average earnings surprise of 6.6%.
The demand for Commercial Metals’ finished steel products in North America continues to remain strong. Downstream bid volumes, which are a significant indicator of the construction project pipeline, have been improving and are expected to have led to higher backlog levels. Demand from industrial end markets is also likely to have been stable.
In the fourth quarter, shipments of finished steel products in North America are expected to have been consistent with the third quarter. Our model projects total shipments in North America to be around 1,506,000 tons, which indicates year-over-year growth of 1%.
The North America segment’s results in the fourth quarter of fiscal 2023 are expected to reflect lower average selling price for steel products. Our model projects average price of steel products to be $970 per ton, down 12% year over year. The average selling price for downstream products is expected to be 4% higher in the fourth quarter at $1,402 per ton.
The North America segment’s net sales are expected to be around $1,741 million in the fiscal fourth quarter, down 13%, compared with $1,988 million recorded in the prior-year quarter’s levels. The segment’s adjusted EBITDA is projected to be around $333 million compared with the year-earlier quarter’s $371 million.
Volumes in the Europe segment are expected to have been impacted by the weak market conditions. Deceleration in construction activity in Poland and weak demand from industrial sector are expected to have led to a 17% year-over-year decline in steel products volumes in the fourth quarter of fiscal 2023 to 355,000 tons, as per our model. Average steel prices are expected to have been $727.25 per ton, down 18% year over year. Lower margins over scrap, higher energy costs, and reduced shipment volumes are likely to have hurt the Europe segment’s results in the quarter under review.
The Europe segment’s revenues are projected to be $280 million, which indicates a 32% year-over-year decline. The segment’s adjusted EBITDA is expected to be $33 million in the fiscal fourth quarter, which projects a 49% slump from the year-ago quarter’s $64 million.
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 -1.06%.
Commercial Metal’s shares have gained 15% in the past year compared with the industry’s 37.9% growth.
Image Source: Zacks Investment Research
Stocks Worth a Look
Here are some stocks, which have the right combination of elements to post an earnings beat in their upcoming releases.
Ecolab (ECL - Free Report) is slated to report third-quarter 2023 results on Oct 31. The company has an Earnings ESP of +0.45% and a Zacks Rank of 2 at present. The Zacks Consensus Estimate for ECL’s third-quarter earnings is pegged at $1.52 per share, indicating an increase of 17% from the year-ago quarter’s figure. Quarterly revenues are estimated to increase 8.7% year over year to around $4 billion.
PPG Industries (PPG - Free Report) currently has an Earnings ESP of +0.32% and a Zacks Rank of 3. The company is slated to report third-quarter 2023 results on Oct 18. It has a trailing four-quarter earnings surprise of 7.2%, on average.
The Zacks Consensus Estimate for PPG’s third-quarter earnings is pegged at $1.94 per share, implying a year-over-year increase of 17%. Revenue estimates are pegged at $4.63 billion, indicating a 3.5% increase from the year-ago quarter.
Dow (DOW - Free Report) presently has an Earnings ESP of +6.30% and a Zacks Rank of 3. The company is expected to report third-quarter 2023 results on Oct 24. It has a trailing four-quarter earnings surprise of 13.1%, on average.
The Zacks Consensus Estimate for DOW’s third-quarter earnings is pegged at 44 cents per share, indicating a year-over-year decline of 60.4%. The same for revenues is pegged at $10.4 billion, indicating a year-over-year decline of 26.4%.
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What's in Store for Commercial Metals (CMC) in Q4 Earnings?
Commercial Metals Company (CMC - Free Report) is expected to report declines in the top and bottom lines in its fourth-quarter fiscal 2023 results. While the robust demand in North America for Commercial Metals’ major product lines is expected to get reflected in the results, the low demand in Europe is likely to have negated these gains.
Q4 Estimates
The Zacks Consensus Estimate for fiscal fourth-quarter revenues is pegged at $2.09 billion, indicating a 13% decline from the prior-year quarter’s reported figure. The same for earnings is pegged at $1.88 per share, implying a 23.3% decline from the year-ago period.
Q3 Performance
In the last reported quarter, the company’s top and bottom lines beat the Zacks Consensus Estimate. However, both earnings and revenues declined year over year. The company has a trailing four-quarter average earnings surprise of 6.6%.
Commercial Metals Company Price and EPS Surprise
Commercial Metals Company price-eps-surprise | Commercial Metals Company Quote
Key Factors to Consider
The demand for Commercial Metals’ finished steel products in North America continues to remain strong. Downstream bid volumes, which are a significant indicator of the construction project pipeline, have been improving and are expected to have led to higher backlog levels. Demand from industrial end markets is also likely to have been stable.
In the fourth quarter, shipments of finished steel products in North America are expected to have been consistent with the third quarter. Our model projects total shipments in North America to be around 1,506,000 tons, which indicates year-over-year growth of 1%.
The North America segment’s results in the fourth quarter of fiscal 2023 are expected to reflect lower average selling price for steel products. Our model projects average price of steel products to be $970 per ton, down 12% year over year. The average selling price for downstream products is expected to be 4% higher in the fourth quarter at $1,402 per ton.
The North America segment’s net sales are expected to be around $1,741 million in the fiscal fourth quarter, down 13%, compared with $1,988 million recorded in the prior-year quarter’s levels. The segment’s adjusted EBITDA is projected to be around $333 million compared with the year-earlier quarter’s $371 million.
Volumes in the Europe segment are expected to have been impacted by the weak market conditions. Deceleration in construction activity in Poland and weak demand from industrial sector are expected to have led to a 17% year-over-year decline in steel products volumes in the fourth quarter of fiscal 2023 to 355,000 tons, as per our model. Average steel prices are expected to have been $727.25 per ton, down 18% year over year. Lower margins over scrap, higher energy costs, and reduced shipment volumes are likely to have hurt the Europe segment’s results in the quarter under review.
The Europe segment’s revenues are projected to be $280 million, which indicates a 32% year-over-year decline. The segment’s adjusted EBITDA is expected to be $33 million in the fiscal fourth quarter, which projects a 49% slump from the year-ago quarter’s $64 million.
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 -1.06%.
Zacks Rank: Commercial Metals currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Price Performance
Commercial Metal’s shares have gained 15% in the past year compared with the industry’s 37.9% growth.
Image Source: Zacks Investment Research
Stocks Worth a Look
Here are some stocks, which have the right combination of elements to post an earnings beat in their upcoming releases.
Ecolab (ECL - Free Report) is slated to report third-quarter 2023 results on Oct 31. The company has an Earnings ESP of +0.45% and a Zacks Rank of 2 at present.
The Zacks Consensus Estimate for ECL’s third-quarter earnings is pegged at $1.52 per share, indicating an increase of 17% from the year-ago quarter’s figure. Quarterly revenues are estimated to increase 8.7% year over year to around $4 billion.
PPG Industries (PPG - Free Report) currently has an Earnings ESP of +0.32% and a Zacks Rank of 3. The company is slated to report third-quarter 2023 results on Oct 18. It has a trailing four-quarter earnings surprise of 7.2%, on average.
The Zacks Consensus Estimate for PPG’s third-quarter earnings is pegged at $1.94 per share, implying a year-over-year increase of 17%. Revenue estimates are pegged at $4.63 billion, indicating a 3.5% increase from the year-ago quarter.
Dow (DOW - Free Report) presently has an Earnings ESP of +6.30% and a Zacks Rank of 3. The company is expected to report third-quarter 2023 results on Oct 24. It has a trailing four-quarter earnings surprise of 13.1%, on average.
The Zacks Consensus Estimate for DOW’s third-quarter earnings is pegged at 44 cents per share, indicating a year-over-year decline of 60.4%. The same for revenues is pegged at $10.4 billion, indicating a year-over-year decline of 26.4%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.