COMMERCIAL METALS Co (CMC) stock analysis

P/E above its 5-year median

Commercial Metals's P/E of 11.0 is above its own 5-year median of 9.8.

P/E below the industry

Commercial Metals's P/E of 11.0 is below the Steel Works, Blast Furnaces, and Rolling and Finishing Mills median of 17.9.

EV/EBITDA above its 5-year median

Commercial Metals's EV/EBITDA of 8.8 is above its 5-year median of 6.0.

P/B below the industry

Commercial Metals's price-to-book of 1.51 is below the Steel Works, Blast Furnaces, and Rolling and Finishing Mills median of 1.75.

Trading below fair value

The share price of $64.68 is below our fair value estimate of $69.76.

Margin of safety under 20%

The price is 7.3% below fair value, less than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew 2.2% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -6.8% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 675% over the last twelve months, against a 5-year average of 9.7% a year.

Growing faster than the industry

Revenue grew 20.5% over the last twelve months; the Steel Works, Blast Furnaces, and Rolling and Finishing Mills median is 9.8%.

Guidance issued

The latest outlook (full fiscal year EBITDA, Mar 26, 2026) was issued for the first time, so it neither adds nor takes away points.

Gross margin improving

Gross margin was 18.6% over the last twelve months, against 15.6% a year earlier.

Return on equity under 15%

Return on equity was 14.8% over the last twelve months and averaged 19.0% over five years; we look for 15% on both.

Return on invested capital

Needs operating income and invested capital.

Return on equity above the industry

Commercial Metals's return on equity of 14.8% is above the Steel Works, Blast Furnaces, and Rolling and Finishing Mills median of 3.6%.

Earnings grew over 5 years

Net income grew 9.7% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 7.0% over the last twelve months, against a 5-year average of 7.5%.

Net margin above the industry

Commercial Metals's net margin of 7.0% is above the Steel Works, Blast Furnaces, and Rolling and Finishing Mills median of 4.0%.

High debt

Debt is 72.0% of shareholders' equity, above the 40% we consider low.

Debt rising against equity

Debt to equity rose from 46.6% five years ago to 72.0%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 31.3% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term assets cover short-term debts

Current assets are 2.34 times current liabilities.

Bankruptcy risk in the grey zone

The Altman Z-score is 2.63; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Commercial Metals paid dividends worth 0.9% of the share price over the last twelve months.

Yield below Treasuries

The 0.9% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Commercial Metals yields 0.9%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Covered by earnings

Dividends take 12.8% of net income.

Covered by free cash flow

Dividends take 17.6% of free cash flow.