Gerdau S.A. (NYSE:GGB) Sees Significant Growth in Short Interest

Key Points

• Gerdau saw a 346.6% increase in short interest to 4,378,053 shares as of March 31, though the short-interest ratio is just 0.2 days and only about 0.2% of the stock is shorted.
• Insiders have sold a total of 169,607 shares in the past three months (including an 85,607‑share sale by the chairman), leaving insiders with roughly 0.02% ownership.
• Analysts have become more positive, producing a MarketBeat consensus of Moderate Buy with an average price target of $4.60, while the stock trades near $4.22 and yields about 1.8%.

Gerdau S.A. (NYSE:GGB - Get Free Report) saw a significant increase in short interest in March. As of March 31st, there was short interest totaling 4,378,053 shares, an increase of 346.6% from the March 15th total of 980,307 shares. Based on an average daily trading volume, of 19,918,794 shares, the short-interest ratio is presently 0.2 days. Currently, 0.2% of the company's stock are short sold.

Insider Buying and Selling at Gerdau

In other Gerdau news, Chairman Guilherme Chagas G. Johannpeter sold 85,607 shares of the firm's stock in a transaction dated 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 document filed with the SEC, which is available through the SEC website. Also, insider Chia Yuan Wang sold 34,000 shares of the firm's stock in a transaction dated Wednesday, April 8th. The shares were sold at an average price of $4.00, for a total value of $136,000.00. Following the transaction, the insider owned 193,895 shares in the company, valued at approximately $775,580. This trade represents a 14.92% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold a total of 169,607 shares of company stock worth $618,147 over the last three months. Corporate insiders own 0.02% of the company's stock.

Institutional Investors Weigh In On Gerdau

A number of institutional investors have recently added to or reduced their stakes in the stock. BSW Wealth Partners boosted its holdings in Gerdau by 4.7% during the fourth quarter. BSW Wealth Partners now owns 53,697 shares of the basic materials company's stock valued at $198,000 after purchasing an additional 2,428 shares in the last quarter. Inspire Investing LLC boosted its holdings in shares of Gerdau by 11.0% in the 4th quarter. Inspire Investing LLC now owns 26,397 shares of the basic materials company's stock worth $97,000 after acquiring an additional 2,607 shares in the last quarter. Xponance LLC boosted its holdings in shares of Gerdau by 16.1% in the 4th quarter. Xponance LLC now owns 20,570 shares of the basic materials company's stock worth $76,000 after acquiring an additional 2,845 shares in the last quarter. Xponance Inc. boosted its holdings in shares of Gerdau by 22.3% in the 3rd quarter. Xponance Inc. now owns 17,725 shares of the basic materials company's stock worth $55,000 after acquiring an additional 3,230 shares in the last quarter. Finally, Vanguard Personalized Indexing Management LLC boosted its holdings in shares of Gerdau by 7.8% in the 3rd quarter. Vanguard Personalized Indexing Management LLC now owns 45,679 shares of the basic materials company's stock worth $142,000 after acquiring an additional 3,312 shares in the last quarter. 1.49% of the stock is owned by institutional investors and hedge funds.

Gerdau Stock Up 0.8%

NYSE GGB opened at $4.22 on Friday. The company has a current ratio of 2.89, a quick ratio of 1.40 and a debt-to-equity ratio of 0.26. The stock's 50 day moving average is $3.84 and its two-hundred day moving average is $3.70. The company has a market capitalization of $8.42 billion, a price-to-earnings ratio of 35.13, a PEG ratio of 1.19 and a beta of 1.44. Gerdau has a 1-year low of $2.42 and a 1-year high of $4.66.

Gerdau (NYSE:GGB - Get Free Report) last released its quarterly earnings data on Tuesday, February 24th. The basic materials company reported $0.07 earnings per share for the quarter, missing analysts' consensus estimates of $0.11 by ($0.04). The company had revenue of $3.08 billion for the quarter, compared to analyst estimates of $3.12 billion. Gerdau had a net margin of 1.93% and a return on equity of 6.20%. Equities analysts forecast that Gerdau will post 0.46 earnings per share for the current fiscal year.

Gerdau Cuts Dividend

The business also recently disclosed a quarterly dividend, which was paid on Wednesday, March 25th. Shareholders of record on Thursday, March 12th were issued a dividend of $0.0194 per share. This represents a $0.08 dividend on an annualized basis and a yield of 1.8%. The ex-dividend date of this dividend was Thursday, March 12th. Gerdau's payout ratio is presently 50.00%.

Wall Street Analyst Weigh In

A number of research firms have recently commented on GGB. Weiss Ratings reiterated a "hold (c)" rating on shares of Gerdau in a research note on Friday, March 27th. Itau BBA Securities upgraded Gerdau from a "market perform" rating to an "outperform" rating and set a $4.60 price objective on the stock in a research note on Wednesday, April 1st. Scotiabank upgraded Gerdau from a "hold" rating to a "strong-buy" rating in a research note on Thursday, March 26th. Finally, UBS Group lifted their price objective on Gerdau from $4.40 to $4.60 and gave the stock a "buy" rating in a research note on Thursday, April 2nd. One research analyst has rated the stock with a Strong Buy rating, two have assigned a Buy rating and two have given a Hold rating to the stock. According to data from MarketBeat, Gerdau has a consensus rating of "Moderate Buy" and an average price target of $4.60.

About Gerdau

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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