📊 CMC Key Takeaways
Is COMMERCIAL METALS Co (CMC) a Good Investment?
Commercial Metals demonstrates solid financial stability with strong liquidity (4.47x current ratio) and a healthy debt position (0.74x D/E), but faces significant profitability headwinds evidenced by an 82.6% YoY decline in net income and weak margins (8.4% net margin). The company's low ROE (4.1%) and ROA (1.9%) indicate inefficient capital deployment despite substantial asset base of $9.2B.
Commercial Metals shows solid underlying financial health, with strong liquidity, positive free cash flow, and a balance sheet that can support cyclical volatility. However, the steep decline in net income, EPS, and weak returns on equity and assets point to materially softer earnings quality and profitability momentum, which limits conviction despite the company’s resilience.
Why Buy COMMERCIAL METALS Co Stock? CMC Key Strengths
- Exceptional liquidity position with $3.0B cash and 4.47x current ratio providing financial flexibility
- Conservative leverage at 0.74x debt-to-equity with strong 7.4x interest coverage ratio
- Positive operating cash flow of $204.2M and free cash flow of $78.8M supporting sustainability
- Robust balance sheet with $4.3B stockholders' equity providing buffer against downturns
- Very strong liquidity with 4.47x current ratio, 3.70x quick ratio, and $3.03B in cash
- Positive operating cash flow and free cash flow indicate the business is still generating cash through the cycle
- Moderate leverage and 7.4x interest coverage suggest debt is currently manageable
CMC Stock Risks: COMMERCIAL METALS Co Investment Risks
- Severe profitability compression with net income declining 82.6% YoY and EPS down 82.1% indicating cyclical downturn or structural challenges
- Weak operational efficiency with net margin of 8.4% and ROE of only 4.1%, suggesting poor capital returns
- Revenue decline of 1.6% YoY combined with gross margin of only 12.4% indicates pricing pressure in competitive steel industry
- Modest free cash flow margin of 3.7% limits reinvestment and shareholder return capacity relative to asset size
- Net income and diluted EPS collapsed more than 80% year over year, signaling major earnings pressure
- Margins are still positive but relatively modest for a cyclical downturn, leaving limited buffer if pricing weakens further
- ROE of 4.1% and ROA of 1.9% indicate weak capital efficiency and subdued profit generation
Key Metrics to Watch
- Quarterly revenue trends and gross margin recovery to assess if cyclical downturn is stabilizing
- Operating margin trajectory and operating leverage as revenue stabilizes
- Return on equity improvement and capital efficiency metrics given low 4.1% current ROE
- Free cash flow consistency and conversion rate as indicator of underlying business quality
- Debt reduction progress to further strengthen balance sheet cushion
- Net income and operating margin trend over the next few quarters
- Free cash flow conversion after capital expenditures
COMMERCIAL METALS Co (CMC) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The relatively thin 3.7% FCF margin may limit capital allocation flexibility. Strong liquidity with a 4.47x current ratio provides a solid financial cushion.
CMC Profit Margin, ROE & Profitability Analysis
CMC vs Materials Sector: How COMMERCIAL METALS Co Compares
How COMMERCIAL METALS Co compares to Materials sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is COMMERCIAL METALS Co Stock Overvalued? CMC Valuation Analysis 2026
Based on fundamental analysis, COMMERCIAL METALS Co has mixed fundamental signals relative to the Materials sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
COMMERCIAL METALS Co Balance Sheet: CMC Debt, Cash & Liquidity
CMC Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: COMMERCIAL METALS Co's revenue has grown significantly by 31% over the 5-year period, indicating strong business expansion. The most recent EPS of $7.25 reflects profitable operations.
CMC Revenue Growth, EPS Growth & YoY Performance
CMC Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q2 2026 | $1.8B | $25.5M | $0.22 |
| Q1 2026 | $1.9B | -$175.7M | $-1.54 |
| Q3 2025 | $2.0B | -$67.1M | $-0.59 |
| Q2 2025 | $1.8B | $25.5M | $0.22 |
| Q1 2025 | $1.9B | -$175.7M | $1.49 |
| Q3 2024 | $2.1B | $119.4M | $1.02 |
| Q2 2024 | $1.8B | $85.8M | $0.73 |
| Q1 2024 | $2.0B | $176.3M | $1.49 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
COMMERCIAL METALS Co Dividends, Buybacks & Capital Allocation
CMC SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for COMMERCIAL METALS Co (CIK: 0000022444)
📋 Recent SEC Filings
❓ Frequently Asked Questions about CMC
What is the AI rating for CMC?
COMMERCIAL METALS Co (CMC) has a Combined AI Rating of HOLD from Claude (HOLD) and ChatGPT (HOLD) with 73% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are CMC's key strengths?
Claude: Exceptional liquidity position with $3.0B cash and 4.47x current ratio providing financial flexibility. Conservative leverage at 0.74x debt-to-equity with strong 7.4x interest coverage ratio. ChatGPT: Very strong liquidity with 4.47x current ratio, 3.70x quick ratio, and $3.03B in cash. Positive operating cash flow and free cash flow indicate the business is still generating cash through the cycle.
What are the risks of investing in CMC?
Claude: Severe profitability compression with net income declining 82.6% YoY and EPS down 82.1% indicating cyclical downturn or structural challenges. Weak operational efficiency with net margin of 8.4% and ROE of only 4.1%, suggesting poor capital returns. ChatGPT: Net income and diluted EPS collapsed more than 80% year over year, signaling major earnings pressure. Margins are still positive but relatively modest for a cyclical downturn, leaving limited buffer if pricing weakens further.
What is CMC's revenue and growth?
COMMERCIAL METALS Co reported revenue of $2.1B.
Does CMC pay dividends?
COMMERCIAL METALS Co pays dividends, with $20.0M distributed to shareholders in the trailing twelve months.
Where can I find CMC SEC filings?
Official SEC filings for COMMERCIAL METALS Co (CIK: 0000022444) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is CMC's EPS?
COMMERCIAL METALS Co has a diluted EPS of $1.58.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is CMC a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, COMMERCIAL METALS Co has a HOLD rating with 73% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is CMC stock overvalued or undervalued?
Valuation metrics for CMC: ROE of 4.1% (sector avg: 14%), net margin of 8.4% (sector avg: 10%). Compare these metrics with sector averages to assess valuation.
Should I buy CMC stock in 2026?
Our dual AI analysis gives COMMERCIAL METALS Co a combined HOLD rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is CMC's free cash flow?
COMMERCIAL METALS Co's operating cash flow is $204.2M, with capital expenditures of $125.4M. FCF margin is 3.7%.
How does CMC compare to other Materials stocks?
Vs Materials sector averages: Net margin 8.4% (avg: 10%), ROE 4.1% (avg: 14%), current ratio 4.47 (avg: 1.6).