Yahoo Finance Commercial Metals Company (NYSE:CMC) Just Released Its Third-Quarter Earnings: Here's What Analysts Think
Investors in Commercial Metals Company (NYSE:CMC) had a good week, as its shares rose 8.0% to close at US$54.42 following the release of its quarterly results. It was a credible result overall, with revenues of US$2.1b and statutory earnings per share of US$1.02 both in line with analyst estimates, showing that Commercial Metals is executing in line with expectations. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Check out our latest analysis for Commercial Metals
Taking into account the latest results, Commercial Metals' six analysts currently expect revenues in 2025 to be US$8.05b, approximately in line with the last 12 months. Statutory earnings per share are forecast to dip 3.4% to US$4.75 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$8.17b and earnings per share (EPS) of US$4.90 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$63.50, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Commercial Metals analyst has a price target of US$70.00 per share, while the most pessimistic values it at US$60.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that revenue is expected to reverse, with a forecast 0.9% annualised decline to the end of 2025. That is a notable change from historical growth of 11% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 5.4% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Commercial Metals is expected to lag the wider industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that in mind, we wouldn't be too quick to come to a conclusion on Commercial Metals. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Commercial Metals going out to 2026, and you can see them free on our platform here..
However, before you get too enthused, we've discovered 2 warning signs for Commercial Metals that you should be aware of.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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