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Can Commercial Metals Sustain Its Strong Core EBITDA Growth Momentum?
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Key Takeaways
CMC's core EBITDA jumped 77.3% y/y to $968M in the first nine months of FY26.
The acquired precast businesses contributed $52.9M to adjusted EBITDA in Q3.
CMC targets FY29 core EBITDA of $1.65B-$1.80B and margins of 15-16%.
Commercial Metals Company’s (CMC - Free Report) core EBITDA surged 77.3% year over year to $968 million in the first nine months of fiscal 2026, driven by metal margin expansion and contributions from the recently acquired precast businesses. The core EBITDA margin reached 14.4% in the same time frame compared with the prior year’s 9.6%.
Backed by healthy domestic demand, strong backlogs and ongoing benefits from strategic initiatives, CMC expects core EBITDA to further increase sequentially in the fourth quarter of fiscal 2026.
CMC closed two major acquisitions in December 2025 — Concrete Pipe and Precast, LLC ("CP&P") and Foley Products Company. The acquired businesses add manufactured concrete pipe and structures used in job-site infrastructure, boosting Commercial Metals’ early-stage construction offering beyond steel and geotechnical solutions. In the third quarter of fiscal 2026, the precast business contributed $52.9 million to adjusted EBITDA. The company expects the precast platform to generate $165-$175 million of EBITDA in fiscal 2026, with incremental annualized EBITDA of $240-$250 million and $30-$40 million of annualized synergies by the end of year three.
Commercial Metals is also benefiting from its Transform, Advance, Grow (“TAG”) Program, which focuses on driving higher through-the-cycle margins, earnings, cash flows and ROIC. CMC expects an annualized EBITDA benefit of more than $250 million in fiscal 2026 and more than $350 million by fiscal 2027 from the program.
On Aug. 5, Commercial Metals introduced its fiscal 2029 financial targets. Backed by its focus on transformation, the company expects to generate structurally higher margins and enhanced free cash flow. CMC expects its fiscal 2029 core EBITDA to be $1.65-$1.80 billion, suggesting a surge of 106% at mid-point from the $837 million delivered in 2025. The core EBITDA margin is expected to be 15-16%.
EBITDA Performance by Commercial Metals’ Peers
Steel Dynamics, Inc. (STLD - Free Report) reported adjusted EBITDA of $1.62 billion in the first six months of 2026, marking a year-over-year increase of 65.1%. Steel Dynamics remains optimistic that domestic steel and aluminum consumption will stay strong through the remainder of 2026 and into 2027. The upside will be supported by improving customer sentiment, stronger order activity, better pricing, domestic trade actions, manufacturing reshoring and infrastructure investments. Steel Dynamics’s strategic investments are projected to boost the company's consolidated annual EBITDA by $650-$700 million.
Cleveland-Cliffs Inc. (CLF - Free Report) posted adjusted EBITDA of $381 million in the first six months of 2026 against a loss of 85 million in the prior year. Cleveland-Cliffs expects third-quarter 2026 adjusted EBITDA of $575 million, more than double the second-quarter results. Cleveland-Cliffs also expects fourth-quarter EBITDA to exceed its third-quarter guidance as average selling prices, shipment volumes and costs continue to move in a favorable direction.
CMC’s Price Performance, Valuations & Estimates
Commercial Metals shares have gained 18.3% in the past year compared with the industry’s 73.4% growth. In comparison, the Zacks Basic Materials sector and the S&P 500 have returned 34.6% and 23%, respectively.
Image Source: Zacks Investment Research
Commercial Metals is currently trading at a forward price/sales ratio of 0.76 compared with the industry's 1.85.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Commercial Metals’ fiscal 2026 sales is $9.18 billion, indicating a 17.7% year-over-year jump. The consensus mark for the year’s earnings is pegged at $6.64 per share, indicating a year-over-year upsurge of 112.1%.
The Zacks Consensus Estimate for fiscal 2027 sales implies 7.6% year-over-year growth. The same for earnings suggests a dip of 9.6%.
EPS estimates for fiscal 2026 and 2027 have moved north over the past 60 days.
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Can Commercial Metals Sustain Its Strong Core EBITDA Growth Momentum?
Key Takeaways
Commercial Metals Company’s (CMC - Free Report) core EBITDA surged 77.3% year over year to $968 million in the first nine months of fiscal 2026, driven by metal margin expansion and contributions from the recently acquired precast businesses. The core EBITDA margin reached 14.4% in the same time frame compared with the prior year’s 9.6%.
Backed by healthy domestic demand, strong backlogs and ongoing benefits from strategic initiatives, CMC expects core EBITDA to further increase sequentially in the fourth quarter of fiscal 2026.
CMC closed two major acquisitions in December 2025 — Concrete Pipe and Precast, LLC ("CP&P") and Foley Products Company. The acquired businesses add manufactured concrete pipe and structures used in job-site infrastructure, boosting Commercial Metals’ early-stage construction offering beyond steel and geotechnical solutions. In the third quarter of fiscal 2026, the precast business contributed $52.9 million to adjusted EBITDA. The company expects the precast platform to generate $165-$175 million of EBITDA in fiscal 2026, with incremental annualized EBITDA of $240-$250 million and $30-$40 million of annualized synergies by the end of year three.
Commercial Metals is also benefiting from its Transform, Advance, Grow (“TAG”) Program, which focuses on driving higher through-the-cycle margins, earnings, cash flows and ROIC. CMC expects an annualized EBITDA benefit of more than $250 million in fiscal 2026 and more than $350 million by fiscal 2027 from the program.
On Aug. 5, Commercial Metals introduced its fiscal 2029 financial targets. Backed by its focus on transformation, the company expects to generate structurally higher margins and enhanced free cash flow. CMC expects its fiscal 2029 core EBITDA to be $1.65-$1.80 billion, suggesting a surge of 106% at mid-point from the $837 million delivered in 2025. The core EBITDA margin is expected to be 15-16%.
EBITDA Performance by Commercial Metals’ Peers
Steel Dynamics, Inc. (STLD - Free Report) reported adjusted EBITDA of $1.62 billion in the first six months of 2026, marking a year-over-year increase of 65.1%. Steel Dynamics remains optimistic that domestic steel and aluminum consumption will stay strong through the remainder of 2026 and into 2027. The upside will be supported by improving customer sentiment, stronger order activity, better pricing, domestic trade actions, manufacturing reshoring and infrastructure investments. Steel Dynamics’s strategic investments are projected to boost the company's consolidated annual EBITDA by $650-$700 million.
Cleveland-Cliffs Inc. (CLF - Free Report) posted adjusted EBITDA of $381 million in the first six months of 2026 against a loss of 85 million in the prior year. Cleveland-Cliffs expects third-quarter 2026 adjusted EBITDA of $575 million, more than double the second-quarter results. Cleveland-Cliffs also expects fourth-quarter EBITDA to exceed its third-quarter guidance as average selling prices, shipment volumes and costs continue to move in a favorable direction.
CMC’s Price Performance, Valuations & Estimates
Commercial Metals shares have gained 18.3% in the past year compared with the industry’s 73.4% growth. In comparison, the Zacks Basic Materials sector and the S&P 500 have returned 34.6% and 23%, respectively.
Commercial Metals is currently trading at a forward price/sales ratio of 0.76 compared with the industry's 1.85.
The Zacks Consensus Estimate for Commercial Metals’ fiscal 2026 sales is $9.18 billion, indicating a 17.7% year-over-year jump. The consensus mark for the year’s earnings is pegged at $6.64 per share, indicating a year-over-year upsurge of 112.1%.
The Zacks Consensus Estimate for fiscal 2027 sales implies 7.6% year-over-year growth. The same for earnings suggests a dip of 9.6%.
EPS estimates for fiscal 2026 and 2027 have moved north over the past 60 days.
CMC currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.