Gerdau S.A. $GGB Stock Position Boosted by Capital International Investors

Key Points

• Capital International Investors increased its stake in Gerdau by 1.9% in Q3 to 31,046,243 shares (about 1.55% ownership) worth roughly $96.2 million, and several other institutions (Robeco, SPX, Kapitalo, Donald Smith, GSA) also added or initiated positions.
• Gerdau missed last quarter's EPS estimates ($0.07 vs. $0.11) and slightly missed revenue expectations; the company has a $7.18B market cap and ~30 P/E, recently cut its quarterly dividend to $0.0194 (annual $0.08, ~2.2% yield, 166.7% payout ratio), and carries an average analyst rating of Hold with a $4.60 target.

Capital International Investors grew its stake in shares of Gerdau S.A. (NYSE:GGB - Free Report) by 1.9% during the third quarter, according to its most recent filing with the Securities and Exchange Commission. The institutional investor owned 31,046,243 shares of the basic materials company's stock after buying an additional 581,958 shares during the quarter. Capital International Investors owned about 1.55% of Gerdau worth $96,243,000 as of its most recent filing with the Securities and Exchange Commission.

A number of other institutional investors also recently made changes to their positions in GGB. Robeco Institutional Asset Management B.V. boosted its stake in Gerdau by 314.9% during the 3rd quarter. Robeco Institutional Asset Management B.V. now owns 262,341 shares of the basic materials company's stock valued at $813,000 after purchasing an additional 199,115 shares in the last quarter. Kapitalo Investimentos Ltda bought a new stake in shares of Gerdau in the 3rd quarter worth $5,958,000. Donald Smith & CO. Inc. acquired a new stake in shares of Gerdau in the second quarter valued at $17,440,000. SPX Gestao de Recursos Ltda lifted its holdings in shares of Gerdau by 56.5% in the third quarter. SPX Gestao de Recursos Ltda now owns 4,491,042 shares of the basic materials company's stock valued at $13,922,000 after buying an additional 1,621,938 shares during the period. Finally, GSA Capital Partners LLP bought a new position in Gerdau during the third quarter valued at about $981,000. 1.49% of the stock is owned by institutional investors and hedge funds.

Gerdau Stock Performance

Gerdau stock opened at $3.60 on Thursday. The firm's 50 day simple moving average is $4.09 and its 200-day simple moving average is $3.63. The company has a market cap of $7.18 billion, a P/E ratio of 29.97, a price-to-earnings-growth ratio of 1.03 and a beta of 1.46. The company has a debt-to-equity ratio of 0.26, a current ratio of 2.89 and a quick ratio of 1.40. Gerdau S.A. has a fifty-two week low of $2.27 and a fifty-two week high of $4.66.

Gerdau (NYSE:GGB - Get Free Report) last issued its quarterly earnings results on Monday, February 23rd. The basic materials company reported $0.07 EPS for the quarter, missing the consensus estimate of $0.11 by ($0.04). Gerdau had a net margin of 1.93% and a return on equity of 6.20%. The firm had revenue of $3.08 billion during the quarter, compared to analysts' expectations of $3.12 billion. As a group, equities research analysts predict that Gerdau S.A. will post 0.46 EPS for the current year.

Gerdau Cuts Dividend

The firm also recently announced a quarterly dividend, which will be paid on Wednesday, March 25th. Stockholders of record on Thursday, March 12th will be issued a $0.0194 dividend. The ex-dividend date is Thursday, March 12th. This represents a $0.08 dividend on an annualized basis and a dividend yield of 2.2%. Gerdau's dividend payout ratio is presently 166.67%.

Analyst Ratings Changes

A number of research analysts recently issued reports on the company. Zacks Research raised Gerdau from a "strong sell" rating to a "hold" rating in a report on Tuesday, November 18th. UBS Group reaffirmed a "buy" rating and issued a $4.60 price objective (up from $4.00) on shares of Gerdau in a research note on Monday, December 15th. Finally, Weiss Ratings reiterated a "hold (c)" rating on shares of Gerdau in a report on Monday, December 29th. One investment analyst has rated the stock with a Buy rating and three have given a Hold rating to the company's stock. According to data from MarketBeat.com, Gerdau has an average rating of "Hold" and an average target price of $4.60.

Gerdau Company Profile

Gerdau SA is a Brazilian-based steel producer engaged in the manufacture and distribution of long steel products for the construction, industrial and agricultural sectors. Established in 1901, the company operates an integrated network of electric-arc furnaces and rolling mills, producing reinforcement bars, wire rod, merchant bars and structural shapes. Gerdau's product portfolio also includes specialty long steel, high-yield reinforcement, rail, beams and steel coils, as well as value-added processing services such as cutting, bending and coating.

The company has expanded its footprint beyond Brazil, with significant operations in North America, South America and a presence in select European markets.

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