How much a stock's price changes over time is important for most investors, since price performance can both impact your investment portfolio and help you compare investment results across sectors and industries.
The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.
What if you'd invested in Commercial Metals (CMC) ten years ago? It may not have been easy to hold on to CMC for all that time, but if you did, how much would your investment be worth today?
Commercial Metals' Business In-Depth
With that in mind, let's take a look at Commercial Metals' main business drivers.
Irving, TX- based Commercial Metals Company manufactures, recycles and markets steel and metal products, related materials and services. It provides these through a network of facilities that includes eight electric arc furnace ("EAF") mini mills, two EAF micro mills, a rerolling mill, steel fabrication and processing plants, construction-related product warehouses, and metal recycling facilities in the United States and Poland.
During the second quarter of fiscal 2018, the company completed the exit of the International Marketing and Distribution segment. Commercial Metals announced that the company has realigned its reporting structure into two operating segments — North America and Europe — from the beginning of fourth-quarter fiscal 2020. North America includes the company's former Americas Recycling, Americas Mills and Americas Fabrication business segments. Europe comprises the company's former International Mill segment.
North America (87% of fiscal 2021 revenues) segment processes scrap metals for use as a raw material by manufacturers of new metal products. This segment operates 34 scrap metal processing facilities, with 14 locations in Texas, five locations in each of Florida and South Carolina, two locations in each of Georgia, Missouri, and North Carolina, and one location in each of Kansas, Louisiana, Oklahoma and Tennessee.
Americas Mills business includes three EAF mini mills, two EAF micro mills, a rerolling mill, two scrap metal shredders, eight scrap metal processing facilities that directly support the mills, and a railroad salvage operation, all of which are based in the United States. Americas Fabrication business consists of steel fabrication facilities that bend, weld, cut and fabricate steel, primarily rebar, and produce steel fence posts; warehouses that sell or rent products for the installation of concrete; and facilities that heat-treat steel to strengthen and provide flexibility.
Europe (13%) segment is comprised of mini mill, recycling and fabrication operations located in Poland.
Bottom Line
Putting together a successful investment portfolio takes a combination of research, patience, and a little bit of risk. For Commercial Metals, if you bought shares a decade ago, you're likely feeling really good about your investment today.
A $1000 investment made in April 2012 would be worth $3,256.18, or a gain of 225.62%, as of April 21, 2022, according to our calculations. This return excludes dividends but includes price appreciation.
In comparison, the S&P 500 gained 223.49% and the price of gold went up 14.52% over the same time frame.
Looking ahead, analysts are expecting more upside for CMC.
Commercial Metals’ third-quarter fiscal 2022 earnings estimates have undergone upward revisions lately. It is poised to gain on robust steel demand, stemming from a growing downstream backlog and solid levels of new construction work entering the project pipeline. Healthy construction markets will support strong rebar and wire rods demand in North America. Steel sales volumes in Europe are anticipated to remain firm on increasing demand from the construction and industrial end market. Construction market in Poland remains robust, aided by expanding manufacturing activity. These factors will boost steel shipment levels in North America and Europe and support the company’s results in third-quarter fiscal 2022. It will benefit from the higher steel prices owing to an upsurge in demand in major end-use markets amid tight supply conditions.
Over the past four weeks, shares have rallied 13.59%, and there have been 2 higher earnings estimate revisions in the past two months for fiscal 2022 compared to none lower. The consensus estimate has moved up as well.5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Commercial Metals Company (CMC): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
