Gerdau (NYSE:GGB) Posts Quarterly Earnings Results, Misses Expectations By $0.01 EPS

Key Points

• Gerdau reported quarterly EPS of $0.14, missing the $0.15 consensus estimate by $0.01, while revenue of $3.45 billion exceeded expectations of $3.41 billion.
• GGB shares rose to $5.09 in Tuesday trading, near the company’s 12-month high of $5.17; the stock has a market capitalization of approximately $10.19 billion.
• Analyst sentiment remains positive, with a “Moderate Buy” consensus and an average price target of $5.28. JPMorgan raised its target to $6.00 and UBS increased its target to $5.25, while hedge funds also expanded their holdings.

Gerdau (NYSE:GGB - Get Free Report) released its earnings results on Tuesday. The basic materials company reported $0.14 earnings per share for the quarter, missing the consensus estimate of $0.15 by ($0.01), FiscalAI reports. The firm had revenue of $3.45 billion during the quarter, compared to the consensus estimate of $3.41 billion. Gerdau had a net margin of 2.40% and a return on equity of 6.76%.

Gerdau Stock Performance

Shares of GGB stock traded up $0.04 during trading on Tuesday, reaching $5.09. 18,818,878 shares of the company's stock were exchanged, compared to its average volume of 18,822,916. The company has a quick ratio of 1.29, a current ratio of 2.76 and a debt-to-equity ratio of 0.26. The stock has a market capitalization of $10.19 billion, a PE ratio of 31.85 and a beta of 1.48. Gerdau has a twelve month low of $2.85 and a twelve month high of $5.17. The firm's fifty day moving average price is $4.53 and its 200-day moving average price is $4.27.

Insiders Place Their Bets

In other Gerdau news, insider Chia Yuan Wang sold 30,935 shares of Gerdau stock in a transaction on Tuesday, June 2nd. The shares were sold at an average price of $4.49, for a total transaction of $138,898.15. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, CEO Cunha Gustavo Werneck Da acquired 165,224 shares of the firm's stock in a transaction on Friday, June 12th. The stock was bought at an average price of $4.73 per share, for a total transaction of $781,509.52. Following the completion of the acquisition, the chief executive officer owned 165,224 shares of the company's stock, valued at approximately $781,509.52. The trade was a ∞ increase in their ownership of the stock. Additional details regarding this purchase are available in the official SEC disclosure. Insiders have sold a total of 493,789 shares of company stock worth $2,389,147 in the last quarter. Insiders own 0.02% of the company's stock.

Institutional Trading of Gerdau

Hedge funds have recently modified their holdings of the stock. AQR Capital Management LLC raised its holdings in Gerdau by 65.9% in the 1st quarter. AQR Capital Management LLC now owns 582,949 shares of the basic materials company's stock valued at $1,656,000 after acquiring an additional 231,588 shares during the period. Millennium Management LLC boosted its holdings in shares of Gerdau by 54.6% during the first quarter. Millennium Management LLC now owns 4,363,764 shares of the basic materials company's stock worth $12,393,000 after acquiring an additional 1,541,311 shares during the period. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC boosted its holdings in shares of Gerdau by 821.1% during the first quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 2,344,175 shares of the basic materials company's stock worth $6,657,000 after acquiring an additional 2,089,675 shares during the period. Sivia Capital Partners LLC acquired a new position in shares of Gerdau in the second quarter valued at approximately $51,000. Finally, Creative Planning grew its position in shares of Gerdau by 88.8% in the second quarter. Creative Planning now owns 70,079 shares of the basic materials company's stock valued at $205,000 after purchasing an additional 32,961 shares during the last quarter. Institutional investors and hedge funds own 1.49% of the company's stock.

Wall Street Analyst Weigh In

A number of brokerages have commented on GGB. Weiss Ratings reiterated a "hold (c)" rating on shares of Gerdau in a research note on Wednesday, June 24th. JPMorgan Chase & Co. boosted their price objective on shares of Gerdau from $5.50 to $6.00 and gave the stock an "overweight" rating in a research note on Thursday, June 25th. Finally, UBS Group reaffirmed a "buy" rating and issued a $5.25 target price (up from $4.60) on shares of Gerdau in a report on Wednesday, April 29th. One equities research analyst has rated the stock with a Strong Buy rating, three have given a Buy rating and two have given a Hold rating to the company's stock. According to MarketBeat, the stock currently has an average rating of "Moderate Buy" and an average price target of $5.28.

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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