Gerdau (NYSE:GGB) Sets New 1-Year High - What's Next?

Key Points

• Gerdau shares reached a new 52-week high, trading as high as $5.48 and recently closing around $5.34. The stock’s average analyst rating remains “Hold,” with an average price target of $5.57.
• The company matched quarterly EPS expectations at $0.15 and exceeded revenue estimates with $3.45 billion in sales. Analysts expect full-year EPS of approximately $0.55.
• Gerdau increased its quarterly dividend to $0.0448 per share, representing an annualized yield of about 3.4%; however, company insiders sold a combined 147,407 shares in the latest quarter.

Shares of Gerdau S.A. (NYSE:GGB - Get Free Report) hit a new 52-week high on Monday. The company traded as high as $5.48 and last traded at $5.3440, with a volume of 2760173 shares traded. The stock had previously closed at $5.01.

Analyst Upgrades and Downgrades

Several research firms recently weighed in on GGB. The Goldman Sachs Group cut shares of Gerdau to a "neutral" rating in a report on Monday, August 24th. UBS Group reaffirmed a "buy" rating and issued a $6.10 target price (up from $5.70) on shares of Gerdau in a research report on Thursday, August 27th. Weiss Ratings raised shares of Gerdau from a "hold (c)" rating to a "hold (c+)" rating in a research note on Wednesday, August 5th. JPMorgan Chase & Co. boosted their price target on shares of Gerdau from $6.00 to $6.50 and gave the company an "overweight" rating in a research report on Friday, September 4th. Finally, Bank of America downgraded shares of Gerdau from a "buy" rating to a "neutral" rating and set a $5.10 price target for the company. in a research note on Thursday, August 20th. One research analyst has rated the stock with a Strong Buy rating, two have issued a Buy rating and six have assigned a Hold rating to the company. Based on data from MarketBeat.com, Gerdau presently has an average rating of "Hold" and an average target price of $5.57.

Gerdau Stock Performance

The company has a debt-to-equity ratio of 0.26, a quick ratio of 1.30 and a current ratio of 2.87. The firm has a market cap of $10.22 billion, a P/E ratio of 22.67 and a beta of 1.48. The business's 50-day simple moving average is $4.84 and its 200 day simple moving average is $4.50.

Gerdau (NYSE:GGB - Get Free Report) last posted its quarterly earnings data on Tuesday, August 4th. The basic materials company reported $0.15 earnings per share (EPS) for the quarter, hitting analysts' consensus estimates of $0.15. Gerdau had a net margin of 3.37% and a return on equity of 7.97%. The company had revenue of $3.45 billion for the quarter, compared to the consensus estimate of $3.41 billion. As a group, equities analysts predict that Gerdau S.A. will post 0.55 earnings per share for the current year.

Gerdau Increases Dividend

The company also recently announced a quarterly dividend, which was paid on Friday, September 18th. Investors of record on Friday, August 21st were paid a dividend of $0.0448 per share. This is a positive change from Gerdau's previous quarterly dividend of $0.0361. The ex-dividend date was Friday, August 21st. This represents a $0.18 dividend on an annualized basis and a dividend yield of 3.4%. Gerdau's dividend payout ratio is presently 65.22%.

Insiders Place Their Bets

In other Gerdau news, Chairman Claudio Johannpeter sold 85,607 shares of the company's stock in a transaction that occurred on Wednesday, September 23rd. The stock was sold at an average price of $4.94, for a total value of $422,898.58. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, EVP Rafael Lopes sold 51,800 shares of the company's stock in a transaction on Thursday, September 17th. The stock was sold at an average price of $5.09, for a total transaction of $263,662.00. Following the transaction, the executive vice president owned 83,399 shares of the company's stock, valued at approximately $424,500.91. This represents a 38.31% decrease in their position. The SEC filing for this sale provides additional information. In the last quarter, insiders sold 147,407 shares of company stock worth $737,561. Corporate insiders own 0.02% of the company's stock.

Institutional Inflows and Outflows

Institutional investors and hedge funds have recently bought and sold shares of the company. SmartHarvest Portfolios LLC purchased a new stake in Gerdau in the 1st quarter valued at about $43,000. Allspring Global Investments Holdings LLC purchased a new stake in shares of Gerdau in the first quarter valued at approximately $45,000. Bank of New York Mellon Corp purchased a new stake in shares of Gerdau in the first quarter valued at approximately $46,000. Greenspring Advisors LLC bought a new position in Gerdau in the second quarter worth approximately $47,000. Finally, EverSource Wealth Advisors LLC increased its holdings in Gerdau by 57.6% during the 1st quarter. EverSource Wealth Advisors LLC now owns 13,243 shares of the basic materials company's stock worth $48,000 after purchasing an additional 4,842 shares during the period. 1.49% of the stock is owned by hedge funds and other institutional investors.

Gerdau Company Profile

Gerdau SA is a Brazilian steel producer and one of the major suppliers of long steel in the Americas. The company manufactures products including rebar, wire rod, structural shapes, merchant bars and other steel products used in construction, infrastructure, industrial manufacturing and agricultural equipment.

Gerdau also produces special steel for the automotive, machinery and other industrial sectors, as well as flat steel products through its operations in Brazil. Its business includes steel recycling, with a significant portion of its production based on ferrous scrap, and the company operates a network of steel mills, fabrication facilities and distribution centers.

Founded in Brazil in 1901, Gerdau serves customers across Brazil, North America and South America.

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