Gerdau (NYSE:GGB) Shares Pass Above 200-Day Moving Average - Here's Why

Key Points

• Gerdau S.A. surpassed its 200-day moving average of $2.87, reaching a trading high of $3.15, which indicates positive momentum for the stock.
• UBS Group upgraded Gerdau from a "neutral" rating to a "buy" rating, adjusting their price target from $2.90 to $3.80, reflecting increased confidence in the company's performance.
• Gerdau recently declared a quarterly dividend of $0.0216, an increase from the previous $0.02, resulting in a dividend yield of 2.8%.

Gerdau S.A. (NYSE:GGB - Get Free Report) crossed above its 200-day moving average during trading on Thursday . The stock has a 200-day moving average of $2.87 and traded as high as $3.15. Gerdau shares last traded at $3.13, with a volume of 13,893,323 shares changing hands.

Wall Street Analyst Weigh In

Separately, UBS Group raised Gerdau from a "neutral" rating to a "buy" rating and raised their price objective for the company from $2.90 to $3.80 in a report on Monday, June 9th. One investment analyst has rated the stock with a Buy rating and one has assigned a Hold rating to the company. According to data from MarketBeat, Gerdau has a consensus rating of "Moderate Buy" and a consensus target price of $3.80.

Gerdau Trading Up 0.8%

The firm has a 50-day moving average of $3.01 and a 200-day moving average of $2.87. The company has a debt-to-equity ratio of 0.30, a quick ratio of 1.50 and a current ratio of 2.89. The firm has a market capitalization of $6.24 billion, a P/E ratio of 10.78, a price-to-earnings-growth ratio of 0.76 and a beta of 1.38.

Gerdau (NYSE:GGB - Get Free Report) last posted its quarterly earnings results on Thursday, July 31st. The basic materials company reported $0.08 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.09 by ($0.01). Gerdau had a return on equity of 6.51% and a net margin of 4.81%.The company had revenue of $3.13 billion for the quarter, compared to the consensus estimate of $3.22 billion. On average, equities research analysts anticipate that Gerdau S.A. will post 0.46 EPS for the current fiscal year.

Gerdau Increases Dividend

The firm also recently disclosed a quarterly dividend, which was paid on Monday, August 25th. Stockholders of record on Wednesday, August 13th were given a $0.0216 dividend. The ex-dividend date was Wednesday, August 13th. This represents a $0.09 dividend on an annualized basis and a dividend yield of 2.8%. This is an increase from Gerdau's previous quarterly dividend of $0.02. Gerdau's dividend payout ratio is 27.59%.

Institutional Investors Weigh In On Gerdau

A number of large investors have recently made changes to their positions in GGB. Encompass Capital Advisors LLC bought a new stake in shares of Gerdau in the 1st quarter worth approximately $30,134,000. Bank of America Corp DE grew its position in shares of Gerdau by 162.6% in the 2nd quarter. Bank of America Corp DE now owns 12,984,389 shares of the basic materials company's stock worth $37,914,000 after buying an additional 8,039,814 shares during the last quarter. Carrhae Capital LLP bought a new stake in shares of Gerdau in the 1st quarter worth approximately $18,655,000. Two Sigma Advisers LP grew its position in shares of Gerdau by 107.4% in the 4th quarter. Two Sigma Advisers LP now owns 12,645,660 shares of the basic materials company's stock worth $36,420,000 after buying an additional 6,548,200 shares during the last quarter. Finally, Donald Smith & CO. Inc. bought a new stake in shares of Gerdau in the 2nd quarter worth approximately $17,440,000. 1.49% of the stock is currently owned by institutional investors.

About Gerdau

Gerdau SA, together with its subsidiaries, operates as a steel producer company. The company operates through Brazil Business, North America Business, South America Business, and Special Steel Business segments. It also provides semi-finished products, including billets, blooms, and slabs; common long rolled products, such as rebars, wire rods, merchant bars, light shapes, and profiles to the construction and manufacturing industries; drawn products comprising barbed and barbless fence wires, galvanized wires, fences, concrete reinforcing wire mesh, nails, and clamps for manufacturing, construction, and agricultural industries; and special steel products used in auto parts, light and heavy vehicles, and agricultural machinery, as well as in the oil and gas, wind energy, machinery and equipment, mining and rail, and other markets.

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