Gerdau S.A. (NYSE:GGB) Given Average Rating of "Moderate Buy" by Brokerages

Key Points

• Gerdau S.A. has a consensus analyst rating of “Moderate Buy” from six covering firms, with an average 12-month price target of about $5.12.
• The company recently posted mixed quarterly results, reporting EPS of $0.10 versus estimates of $0.15 and revenue of $3.22 billion versus expectations of $3.36 billion.
• Gerdau also raised its quarterly dividend to $0.0361 per share, up from $0.02, implying an annualized yield of roughly 3.1%.

Shares of Gerdau S.A. (NYSE:GGB - Get Free Report) have been assigned a consensus rating of "Moderate Buy" from the six ratings firms that are currently covering the company, Marketbeat Ratings reports. Two research analysts have rated the stock with a hold recommendation, three have issued a buy recommendation and one has assigned a strong buy recommendation to the company. The average twelve-month price target among brokerages that have covered the stock in the last year is $5.1167.

Several equities research analysts have issued reports on GGB shares. Weiss Ratings reaffirmed a "hold (c)" rating on shares of Gerdau in a report on Friday, March 27th. UBS Group reiterated a "buy" rating and issued a $5.25 price objective (up from $4.60) on shares of Gerdau in a report on Wednesday, April 29th. Scotiabank upgraded shares of Gerdau from a "hold" rating to a "strong-buy" rating in a research note on Thursday, March 26th. Itau BBA Securities raised shares of Gerdau from a "market perform" rating to an "outperform" rating and set a $4.60 target price for the company in a report on Wednesday, April 1st. Finally, JPMorgan Chase & Co. upped their price target on shares of Gerdau from $5.00 to $5.50 and gave the company an "overweight" rating in a research note on Monday, April 13th.

Insider Activity at Gerdau

In related news, Chairman Guilherme Chagas G. Johannpeter sold 85,607 shares of Gerdau stock in a transaction that occurred on Friday, March 20th. The stock was sold at an average price of $3.29, for a total transaction of $281,647.03. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, CEO Cunha Gustavo Werneck Da sold 432,854 shares of the company's stock in a transaction on Friday, May 8th. The shares were sold at an average price of $4.87, for a total value of $2,107,998.98. Following the completion of the transaction, the chief executive officer directly owned 432,854 shares in the company, valued at approximately $2,107,998.98. This represents a 50.00% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 823,856 shares of company stock valued at $3,722,025 in the last 90 days. Corporate insiders own 0.02% of the company's stock.

Institutional Trading of Gerdau

Hedge funds and other institutional investors have recently bought and sold shares of the business. UBS Group AG raised its stake in Gerdau by 45.1% in the fourth quarter. UBS Group AG now owns 3,034,398 shares of the basic materials company's stock valued at $11,197,000 after purchasing an additional 943,254 shares in the last quarter. Capital International Investors boosted its position in shares of Gerdau by 1.9% during the 3rd quarter. Capital International Investors now owns 31,046,243 shares of the basic materials company's stock worth $96,243,000 after acquiring an additional 581,958 shares in the last quarter. GSA Capital Partners LLP bought a new position in Gerdau in the third quarter valued at approximately $981,000. Kapitalo Investimentos Ltda acquired a new position in Gerdau during the third quarter valued at approximately $5,958,000. Finally, SPX Gestao de Recursos Ltda lifted its stake in Gerdau by 56.5% during the third quarter. SPX Gestao de Recursos Ltda now owns 4,491,042 shares of the basic materials company's stock worth $13,922,000 after purchasing an additional 1,621,938 shares during the last quarter. Institutional investors and hedge funds own 1.49% of the company's stock.

Gerdau Price Performance

Shares of GGB opened at $4.70 on Thursday. The company has a market cap of $9.39 billion, a price-to-earnings ratio of 29.35 and a beta of 1.51. The company's fifty day simple moving average is $4.07 and its 200 day simple moving average is $3.94. Gerdau has a 1-year low of $2.61 and a 1-year high of $4.98. The company has a current ratio of 2.76, a quick ratio of 1.29 and a debt-to-equity ratio of 0.26.

Gerdau (NYSE:GGB - Get Free Report) last issued its earnings results on Tuesday, April 28th. The basic materials company reported $0.10 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $0.15 by ($0.05). Gerdau had a net margin of 2.40% and a return on equity of 6.76%. The firm had revenue of $3.22 billion during the quarter, compared to the consensus estimate of $3.36 billion. On average, research analysts forecast that Gerdau will post 0.51 earnings per share for the current fiscal year.

Gerdau Increases Dividend

The company also recently announced a quarterly dividend, which will be paid on Tuesday, June 16th. Stockholders of record on Friday, May 15th will be given a $0.0361 dividend. The ex-dividend date of this dividend is Friday, May 15th. This is a positive change from Gerdau's previous quarterly dividend of $0.02. This represents a $0.14 annualized dividend and a dividend yield of 3.1%. Gerdau's dividend payout ratio (DPR) is currently 75.00%.

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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