Constellium (NYSE:CSTM) Shares Gap Down - Here's Why

Key Points

• Constellium shares gapped down on Wednesday, opening at $33.00 after closing at $35.28 and last trading around $32.81.
• Despite the drop, analysts remain broadly positive: the stock has a consensus “Buy” rating and an average price target of $36.60, with several firms recently reiterating or raising bullish views.
• The company recently reported strong quarterly results, including EPS of $1.42 versus estimates of $0.62 and revenue growth of 24.4% year over year, and it also authorized a $300 million share buyback.

Shares of Constellium SE (NYSE:CSTM - Get Free Report) gapped down before the market opened on Wednesday . The stock had previously closed at $35.28, but opened at $33.00. Constellium shares last traded at $32.8120, with a volume of 1,395,612 shares traded.

Wall Street Analysts Forecast Growth

A number of equities research analysts have recently weighed in on CSTM shares. BMO Capital Markets set a $32.00 price target on shares of Constellium and gave the company an "outperform" rating in a research report on Thursday, April 9th. UBS Group started coverage on shares of Constellium in a research report on Tuesday, May 5th. They issued a "buy" rating and a $38.00 price target for the company. Deutsche Bank Aktiengesellschaft restated a "buy" rating and issued a $40.00 price target on shares of Constellium in a research report on Thursday, April 30th. Zacks Research raised Constellium from a "hold" rating to a "strong-buy" rating in a research note on Tuesday, May 12th. Finally, JPMorgan Chase & Co. reaffirmed a "neutral" rating and issued a $34.00 price target (up from $30.00) on shares of Constellium in a research note on Thursday, April 30th. Two analysts have rated the stock with a Strong Buy rating, three have assigned a Buy rating and two have issued a Hold rating to the company. According to data from MarketBeat, the company has an average rating of "Buy" and a consensus price target of $36.60.

Constellium Stock Performance

The company has a debt-to-equity ratio of 1.71, a current ratio of 1.39 and a quick ratio of 0.60. The stock has a 50-day simple moving average of $29.49 and a 200-day simple moving average of $23.86. The stock has a market cap of $4.57 billion, a P/E ratio of 10.82 and a beta of 1.54.

Constellium (NYSE:CSTM - Get Free Report) last released its earnings results on Wednesday, April 29th. The industrial products company reported $1.42 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.62 by $0.80. Constellium had a return on equity of 46.22% and a net margin of 4.87%.The firm had revenue of $2.46 billion for the quarter, compared to analysts' expectations of $2.43 billion. During the same quarter in the previous year, the business posted $0.26 earnings per share. The business's revenue for the quarter was up 24.4% on a year-over-year basis. Research analysts forecast that Constellium SE will post 3.34 earnings per share for the current year.

Constellium announced that its board has authorized a stock buyback program on Thursday, March 12th that permits the company to buyback $300.00 million in outstanding shares. This buyback authorization permits the industrial products company to repurchase up to 8.8% of its stock through open market purchases. Stock buyback programs are usually an indication that the company's management believes its stock is undervalued.

Insider Activity at Constellium

In other news, insider Stephane Corre sold 5,000 shares of the business's stock in a transaction dated Friday, May 8th. The stock was sold at an average price of $33.52, for a total transaction of $167,600.00. Following the sale, the insider directly owned 62,313 shares in the company, valued at approximately $2,088,731.76. The trade was a 7.43% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is accessible through the SEC website. Also, SVP Nicolas Brun sold 26,661 shares of the business's stock in a transaction dated Monday, May 11th. The stock was sold at an average price of $33.85, for a total value of $902,474.85. Following the sale, the senior vice president owned 104,891 shares in the company, valued at approximately $3,550,560.35. This trade represents a 20.27% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last 90 days, insiders purchased 5,490 shares of company stock valued at $167,089 and sold 371,035 shares valued at $10,772,766. 1.20% of the stock is currently owned by company insiders.

Institutional Trading of Constellium

Several institutional investors have recently added to or reduced their stakes in CSTM. Royal Bank of Canada boosted its holdings in Constellium by 5.3% in the first quarter. Royal Bank of Canada now owns 72,526 shares of the industrial products company's stock valued at $732,000 after acquiring an additional 3,629 shares during the last quarter. AQR Capital Management LLC boosted its holdings in Constellium by 354.0% in the first quarter. AQR Capital Management LLC now owns 91,566 shares of the industrial products company's stock valued at $924,000 after acquiring an additional 71,396 shares during the last quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. boosted its holdings in Constellium by 4.6% in the first quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 77,021 shares of the industrial products company's stock valued at $777,000 after acquiring an additional 3,393 shares during the last quarter. Prudential Financial Inc. bought a new stake in Constellium in the second quarter valued at approximately $218,000. Finally, Norges Bank bought a new stake in Constellium in the second quarter valued at approximately $1,499,000. 92.59% of the stock is currently owned by institutional investors.

Constellium Company Profile

Constellium SE is a global leader in the design and manufacture of high-performance aluminum products and solutions. The company serves key markets including aerospace, automotive, and packaging, offering advanced rolled and extruded aluminum sheet, plate and structural components. Its product portfolio encompasses precision-engineered parts for commercial and military aircraft, automotive body structures and closures, beverage and specialty packaging, as well as industrial and structural applications.

Established in 2011 through the consolidation of Rio Tinto Alcan's rolled-products and engineered-products businesses, Constellium has built a reputation for innovation in lightweighting and sustainability.

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