BlackRock Inc. Invests $954.99 Million in Commercial Metals Company $CMC

Key Points

• BlackRock acquired 15.2 million shares of Commercial Metals worth approximately $955 million, giving it a 13.76% stake. Overall, institutional investors own 86.9% of CMC.
• Analysts maintain a generally positive outlook, with a consensus “Moderate Buy” rating and an average price target of $81.18, above the reported share price of $66.36.
• Commercial Metals exceeded quarterly earnings and revenue expectations, while authorizing a $600 million share-repurchase program and maintaining a $0.20 quarterly dividend, equivalent to a 1.2% yield.

BlackRock Inc. purchased a new position in shares of Commercial Metals Company (NYSE:CMC - Free Report) in the 2nd quarter, according to its most recent 13F filing with the Securities and Exchange Commission (SEC). The firm purchased 15,218,955 shares of the basic materials company's stock, valued at approximately $954,989,000. BlackRock Inc. owned 13.76% of Commercial Metals as of its most recent filing with the Securities and Exchange Commission (SEC).

A number of other institutional investors and hedge funds have also recently added to or reduced their stakes in CMC. Artemis Investment Management LLP purchased a new stake in Commercial Metals in the 4th quarter worth approximately $103,962,000. Norges Bank purchased a new position in shares of Commercial Metals during the 4th quarter valued at $97,983,000. Bank of New York Mellon Corp purchased a new position in shares of Commercial Metals during the 2nd quarter valued at $59,572,000. Bank of America Corp DE increased its stake in shares of Commercial Metals by 87.4% in the first quarter. Bank of America Corp DE now owns 1,631,213 shares of the basic materials company's stock worth $100,205,000 after acquiring an additional 760,985 shares during the last quarter. Finally, Encompass Capital Advisors LLC acquired a new position in shares of Commercial Metals in the fourth quarter worth $41,523,000. 86.90% of the stock is owned by hedge funds and other institutional investors.

Insider Activity

In other Commercial Metals news, Director John R. Mcpherson acquired 1,390 shares of the company's stock in a transaction dated Thursday, August 13th. The shares were acquired at an average cost of $71.92 per share, for a total transaction of $99,968.80. Following the completion of the purchase, the director owned 21,927 shares of the company's stock, valued at approximately $1,576,989.84. This trade represents a 6.77% increase in their position. The purchase was disclosed in a filing with the SEC, which is accessible through this hyperlink. Also, CEO Peter R. Matt acquired 8,230 shares of the business's stock in a transaction that occurred on Friday, July 10th. The shares were acquired at an average cost of $61.30 per share, with a total value of $504,499.00. Following the transaction, the chief executive officer directly owned 181,522 shares in the company, valued at $11,127,298.60. The trade was a 4.75% increase in their position. The SEC filing for this purchase provides additional information. Company insiders own 0.62% of the company's stock.

Wall Street Analyst Weigh In

A number of analysts recently issued reports on the company. Citigroup reduced their price objective on Commercial Metals from $85.00 to $75.00 and set a "buy" rating for the company in a research report on Tuesday, July 7th. UBS Group raised Commercial Metals from a "neutral" rating to a "buy" rating and raised their price target for the stock from $79.00 to $89.00 in a research note on Wednesday, May 13th. Barclays lifted their price target on Commercial Metals from $75.00 to $80.00 and gave the company an "equal weight" rating in a report on Friday, August 7th. Weiss Ratings raised Commercial Metals from a "hold (c+)" rating to a "buy (b-)" rating in a research note on Thursday, July 30th. Finally, Jefferies Financial Group upgraded Commercial Metals from a "buy" rating to a "buy" rating in a report on Friday, June 5th. Ten investment analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the stock. Based on data from MarketBeat, the company presently has a consensus rating of "Moderate Buy" and an average target price of $81.18.

Commercial Metals Stock Up 1.7%

Shares of CMC stock opened at $66.36 on Friday. The stock's 50 day simple moving average is $68.73 and its 200 day simple moving average is $69.90. Commercial Metals Company has a twelve month low of $53.08 and a twelve month high of $84.87. The company has a debt-to-equity ratio of 0.73, a quick ratio of 1.54 and a current ratio of 2.33. The company has a market capitalization of $7.34 billion, a price-to-earnings ratio of 12.50, a PEG ratio of 0.38 and a beta of 1.52.

Commercial Metals (NYSE:CMC - Get Free Report) last announced its earnings results on Thursday, June 25th. The basic materials company reported $1.73 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $1.70 by $0.03. The firm had revenue of $2.48 billion during the quarter, compared to analysts' expectations of $2.40 billion. Commercial Metals had a return on equity of 15.69% and a net margin of 6.72%.The company's revenue was up 22.9% on a year-over-year basis. During the same quarter in the prior year, the business earned $0.74 earnings per share. As a group, research analysts predict that Commercial Metals Company will post 6.64 EPS for the current year.

Commercial Metals announced that its Board of Directors has initiated a stock repurchase program on Wednesday, August 5th that authorizes the company to repurchase $600.00 million in outstanding shares. This repurchase authorization authorizes the basic materials company to buy up to 7.5% of its stock through open market purchases. Stock repurchase programs are usually an indication that the company's management believes its stock is undervalued.

Commercial Metals Dividend Announcement

The firm also recently declared a quarterly dividend, which was paid on Wednesday, July 15th. Stockholders of record on Monday, July 6th were given a $0.20 dividend. This represents a $0.80 annualized dividend and a dividend yield of 1.2%. The ex-dividend date of this dividend was Monday, July 6th. Commercial Metals's dividend payout ratio (DPR) is currently 15.07%.

About Commercial Metals

Commercial Metals Company NYSE: CMC is a leading global steel and metal recycler, manufacturer and fabricator based in Irving, Texas. The company operates an integrated network of scrap recycling facilities, electric arc furnace steel mills, metal fabrication plants and distribution centers. Through these operations, Commercial Metals collects and processes ferrous scrap to produce finished steel products and provides recycled metal to a variety of end markets.

In its steelmaking segment, CMC uses electric arc furnace technology to transform recycled scrap into reinforcing bar (rebar), merchant bar, coil and structural products.

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