Gerdau (NYSE:GGB) Shares Cross Above 200 Day Moving Average - What's Next?

Key Points

• Gerdau shares moved above their 200-day moving average, trading as high as $4.77 and last changing hands around $4.72, which may signal improving short-term momentum.
• Analysts remain generally constructive on the stock, with a consensus Moderate Buy and an average price target of $5.28. Recent rating actions included upgrades from Scotiabank and Itaú BBA, while UBS and JPMorgan raised their targets.
• Gerdau recently raised its quarterly dividend to $0.0361 per share, implying a 3.1% annual yield. However, its latest earnings missed estimates on both EPS and revenue, underscoring mixed fundamentals.

Shares of Gerdau S.A. (NYSE:GGB - Get Free Report) passed above its 200-day moving average during trading on Friday . The stock has a 200-day moving average of $4.19 and traded as high as $4.77. Gerdau shares last traded at $4.7240, with a volume of 9,829,916 shares.

Analysts Set New Price Targets

Several equities research analysts have issued reports on GGB shares. Weiss Ratings reissued a "hold (c)" rating on shares of Gerdau in a research report on Wednesday, June 24th. UBS Group restated a "buy" rating and issued a $5.25 target price (up from $4.60) on shares of Gerdau in a research note on Wednesday, April 29th. Scotiabank raised shares of Gerdau from a "hold" rating to a "strong-buy" rating in a research report on Thursday, March 26th. Itau BBA Securities upgraded Gerdau from a "market perform" rating to an "outperform" rating and set a $4.60 price target for the company in a report on Wednesday, April 1st. Finally, JPMorgan Chase & Co. boosted their price target on Gerdau from $5.50 to $6.00 and gave the company an "overweight" rating in a report on Thursday, June 25th. One equities research analyst has rated the stock with a Strong Buy rating, three have assigned a Buy rating and two have given a Hold rating to the stock. According to MarketBeat, Gerdau has a consensus rating of "Moderate Buy" and a consensus target price of $5.28.

Gerdau Stock Performance

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 firm has a 50 day moving average price of $4.50 and a 200 day moving average price of $4.19. The stock has a market cap of $9.45 billion, a PE ratio of 29.53 and a beta of 1.50.

Gerdau (NYSE:GGB - Get Free Report) last released its quarterly earnings data on Tuesday, April 28th. The basic materials company reported $0.10 earnings per share for the quarter, missing analysts' consensus estimates of $0.15 by ($0.05). Gerdau had a return on equity of 6.76% and a net margin of 2.40%.The business had revenue of $3.22 billion during the quarter, compared to analysts' expectations of $3.36 billion. As a group, research analysts forecast that Gerdau S.A. will post 0.53 earnings per share for the current year.

Gerdau Increases Dividend

The firm also recently declared a quarterly dividend, which was paid on Tuesday, June 16th. Stockholders of record on Friday, May 15th were issued a $0.0361 dividend. The ex-dividend date was Friday, May 15th. This represents a $0.14 annualized dividend and a dividend yield of 3.1%. This is an increase from Gerdau's previous quarterly dividend of $0.02. Gerdau's dividend payout ratio (DPR) is presently 75.00%.

Insider Transactions at Gerdau

In other news, insider Chia Yuan Wang sold 30,935 shares of the stock in a transaction that occurred 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 filing with the SEC, which can be accessed through this link. Also, insider Clemir Uhlein sold 38,276 shares of Gerdau stock in a transaction that occurred on Tuesday, April 28th. The shares were sold at an average price of $4.51, for a total transaction of $172,624.76. The disclosure for this sale is available in the SEC filing. In the last three months, insiders have sold 671,765 shares of company stock worth $3,200,865. Insiders own 0.02% of the company's stock.

Institutional Trading of Gerdau

Several hedge funds and other institutional investors have recently bought and sold shares of the stock. UBS Group AG raised its stake in shares of Gerdau by 45.1% during the 4th quarter. UBS Group AG now owns 3,034,398 shares of the basic materials company's stock worth $11,197,000 after acquiring an additional 943,254 shares in the last quarter. Massachusetts Financial Services Co. MA lifted its position in Gerdau by 41.1% during the fourth quarter. Massachusetts Financial Services Co. MA now owns 1,327,066 shares of the basic materials company's stock valued at $4,897,000 after acquiring an additional 386,594 shares during the last quarter. Donald Smith & CO. Inc. boosted its stake in Gerdau by 49.2% in the fourth quarter. Donald Smith & CO. Inc. now owns 24,211,588 shares of the basic materials company's stock valued at $89,341,000 after acquiring an additional 7,982,296 shares in the last quarter. Aquamarine Financial Cayman Ltd boosted its stake in Gerdau by 9.7% in the fourth quarter. Aquamarine Financial Cayman Ltd now owns 19,526,171 shares of the basic materials company's stock valued at $72,052,000 after acquiring an additional 1,724,943 shares in the last quarter. Finally, Banque Cantonale Vaudoise purchased a new position in Gerdau in the fourth quarter worth $2,952,000. Institutional investors own 1.49% of the company's stock.

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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