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If You Invested $1000 in Commercial Metals 10 Years Ago, This Is How Much You'd Have Now

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For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.

Another thing that can drive investing is the fear of missing out, or FOMO. This particularly applies to tech giants and popular consumer-facing stocks.

What if you'd invested in Commercial Metals (CMC - Free Report) ten years ago? It may not have been easy to hold on to CMC for all that time, but if you did, how much would your investment be worth today?

Commercial Metals' Business In-Depth

With that in mind, let's take a look at Commercial Metals' main business drivers. Irving, TX- based Commercial Metals Company manufactures, recycles and markets steel and metal products, related materials and services. It provides these through a network of facilities that includes seven electric arc furnace ("EAF") mini mills, two EAF micro mills, a rerolling mill, steel fabrication and processing plants, construction-related product warehouses, and metal recycling facilities in the United States and Poland.

Commercial Metals realigned its reporting structure into three operating segments — North America Steel Group, Europe Steel Group and Emerging Businesses Group — from the beginning of first-quarter fiscal 2024.

North America Steel Group segment consists largely of CMC's former North America segment's recycling, steel mill, rebar fabrication, fence post manufacturing and post-tension cable operations.

The steel mill operations include six EAF mini mills, two EAF micro mills, and one rerolling mill. The fabrication operations include 56 facilities engaged in various aspects of steel fabrication. Most of these facilities engage in the general fabrication of reinforcing steel.

The steel mills manufacture finished long steel products including rebar, merchant bar, light structural and other special sections and wire rod, as well as semi-finished billets for rerolling and forging applications (collectively referred to as steel products).

Europe Steel Group segment includes essentially all recycling, steel mill and steel fabrication operations that were previously part of the company's Europe segment. It comprises mini mill s, recycling and fabrication operations located in Poland.

Emerging Businesses Group segment includes the Tensar geogrid and Geopier, CMC Construction Services, Performance Reinforcing Steel, CMC Anchoring Systems, and Impact Metals operations. Except for the geogrid operations located outside North America, which were included in the former Europe segment, these were reported under CMC's former North America segment.

Bottom Line

Anyone can invest, but building a successful investment portfolio takes a combination of a few things: research, patience, and a little bit of risk. So, if you had invested in Commercial Metals a decade ago, you're probably feeling pretty good about your investment today.

A $1000 investment made in April 2014 would be worth $3,016.15, or a 201.62% gain, as of April 8, 2024, according to our calculations. Investors should note that this return excludes dividends but includes price increases.

Compare this to the S&P 500's rally of 179.04% and gold's return of 70.62% over the same time frame.

Analysts are forecasting more upside for CMC too.

Commercial Metals’ results have been impacted by lower steel product margins than scrap cost. The company expects margins on steel products to experience further compression in the upcoming quarters. Sluggish demand in Europe is putting pressure on pricing and margins. These market conditions in Europe are expected to persist. Moreover, oversupply in the steel industry has also been impacting the company’s margins. However, strong demand in North America for each of Commercial Metals' primary product lines is likely to be reflected in the company's performance. Strong spring and summer construction activity is expected to aid the third-quarter results. Commercial Metals is implementing price rises across its mill products, which will aid growth. Strategic acquisitions further drive results. Its solid balance sheet bodes well.

The stock has jumped 6.99% over the past four weeks. Additionally, no earnings estimate has gone lower in the past two months, compared to 2 higher, for fiscal 2024; the consensus estimate has moved up as well.

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