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Investing.com - UBS raised its price target on Commercial Metals Company (NYSE:CMC) to $56.00 from $48.00 on Wednesday, while maintaining a Neutral rating on the stock. The stock, currently trading at $56.71, has shown strong momentum with a 13% gain year-to-date. According to InvestingPro analysis, CMC maintains a GOOD financial health score, supported by 12+ exclusive financial insights available to subscribers.
The price target increase follows recent rebar price hikes of $120-140 per short ton for standard rebar, which UBS attributes to higher import breakevens. The firm expects rebar imports to decrease in the second half of 2025. CMC’s strong balance sheet, with a current ratio of 2.86 and moderate debt levels, positions it well to navigate market fluctuations. Discover more detailed insights with InvestingPro’s comprehensive research report, part of its coverage of 1,400+ US stocks.
UBS noted that while imports are up 5% year-to-date, they are down 20% excluding January’s surge, when imports jumped 311%. The firm also pointed out that approximately 75% of rebar imports come from outside the USMCA region, which UBS believes are less likely to receive carve-outs.
The delayed opening of Commercial Metals’ West Virginia facility to the first half of 2026 from the second half of 2025 has reduced near-term supply risks, according to UBS. However, the firm still sees risk from large capacity growth of approximately 1.8 million tons (18%) through early 2027.
UBS projects rebar prices of approximately $780 per short ton in 2026/2027 compared to the current spot price of about $870 per short ton, suggesting limited upside potential for further price increases. With Commercial Metals trading at roughly 6 times UBS’s 2026/2027 estimates, in line with historical averages, the firm maintains its Neutral stance.
In other recent news, Commercial Metals Company reported its third-quarter fiscal 2025 earnings, which fell short of analyst expectations. The company announced earnings per share of $0.74, missing the forecasted $0.84, and reported revenue of $2 billion, slightly below the anticipated $2.05 billion. Additionally, UBS maintained its Neutral rating on Commercial Metals with a price target of $48.00. The investment firm pointed to the company’s strategy for improving margins and return on invested capital, particularly in a consolidated rebar market dominated by Commercial Metals and Nucor. In governance updates, Commercial Metals appointed Dawne S. Hickton to its Board of Directors, expanding the board from nine to ten members. Hickton will also serve on the Audit and Finance Committees. These developments reflect the company’s ongoing efforts to navigate market dynamics and strengthen its leadership.
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