CMC - Commercial Metals Company: Time To Take Profits

2024-05-14 00:10:08 ET

Summary

• Growth trends in Q2 looked sluggish, especially in the European Steel Group.
• Technical Analysis points to more headwinds over the near term.
• Shares look overvalued compared to historic valuation multiples. CMC's return on capital metric also trails its 5-year comparable.

Intro

We wrote about Commercial Metals Company ( CMC ) in 2020 and multiple times in 2021 when we stamped a 'Buy' signal on the steel fabricating company. Since our initial 'Buy' call in July 2020, shares have returned approximately 200% for corresponding shareholders. The company's keen valuation at the time, supporting technicals and a strong growth path supported our bullish thesis, resulting in shares almost eclipsing $60 a share in March of this year....

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