Quality Investor

Commercial Metals Company

Rank #426Op. Leverage

CMC · NYSE · Industrials

Commercial Metals Company (CMC) — Rank #426 by gross profitability (GP/assets 0.12) · ROE 1.9% · Piotroski F-Score 7 / 9.

As-of 2026-09-15 · CIK 0000022444 · all metrics point-in-time as of the filing date.

About

Commercial Metals Company manufactures, recycles, and fabricates steel and metal products, and related materials and services in the United States, Poland, China, and internationally.

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It operates through three segments: North America Steel Group; Europe Steel Group; and Emerging Businesses Group. The company processes and sells ferrous and nonferrous scrap metals to steel mills and foundries, aluminum sheet and ingot manufacturers, brass and bronze ingot makers, copper refineries and mills, secondary lead smelters, specialty steel mills, high temperature alloy manufacturers, and other consumers. It also manufactures and sells finished long steel products, including reinforcing bar, merchant bar, light structural, wire rod, and other special sections, as well as semi-finished billets for rerolling and forging applications. In addition, the company provides fabricated rebar used to reinforce concrete primarily in the construction of commercial and non-commercial buildings, hospitals, convention centers, industrial plants, power plants, highways, bridges, arenas, stadiums, and dams; sells and rents construction-related products and equipment to concrete installers and other businesses; and manufactures and sells strength bars for the truck trailer industry, special bar steels for the energy market, and armor plates for military vehicles. Further, it sells wire meshes, welded steel mesh, wire rod, cold rolled rebar, cold rolled wire rod, assembled rebar cages and other fabricated rebar by-products to fabricators, manufacturers, distributors, and construction companies.

The company was founded in 1915 and is headquartered in Irving, Texas.

Industry
Metal Fabrication
Sector
Industrials
State
DE
Filer Category
Large accelerated filer
Fiscal Year End
August 31
Website
cmc.com

Price History

CMC+125.1% · +17.6% CAGRSPY+80.5% · +12.5% CAGR

Company Snapshot

P/E and reverse DCF are the primary valuation lenses at this stage.

Market Cap

$7.18B

P/E (annual)

87.7

P/S (annual)

0.9

P/B

1.6

P/OCF (annual)

10.0

Shareholder Yield

0.6%

Employees

12,690

Industry

Metal Fabrication

Exchange

NYSE

Signal Flags

2 green1 yellow
Revenue growth acceleratingGrowth rate increasing year over year
Sequential beat (rev + EPS)Both revenue and EPS exceeded prior quarter — 3-quarter streak
Disclosure regressionA previously-disclosed line item is no longer reported — worth checking the filing for why

Quality Profile

Profitability

1/1 pass
GP / assets
0.12
Return on equity
1.9%
Gross margin trend
PASS

Safety

1/1 pass
Balance-sheet safety
PASS
Debt / equity
1.16
Current ratio
2.33×
Net cash
-$2.64B

Cash Flow

3/3 pass
Positive FCF
PASS
Cash-backed earnings
PASS
Accruals healthy
PASS
SBC / revenue
0.5%

Growth

2/2 pass
Revenue growth
23.7%
Piotroski F-Score
7 / 9
Share dilution
0.5%

Terry Smith quality gate

Passes 1/5 Terry Smith thresholds

3 of 5 thresholds not computable from filed data.

What Growth Is Priced In

Implied revenue growth (10Y)

10.0%

incredible deal

The annual FCF growth rate today's price requires over a 10-year horizon (discount rate 10%, terminal growth 2.5%).

Dilution drag: 0.5% — per-share value needs a total required return of 10.5% once share-count change is priced in.

vs. own 6-year median revenue growth: 25.6%

within its own history

Cost-of-equity sensitivity (implied growth at different discount rates)

r = 8%

5.6%

r = 10% (base)

10.0%

r = 12%

13.9%

Net debt / market cap: 35.6%— material leverage inflates the implied growth read.

Base FCF: $312.2M3Y mean FCF: -$45.5M

Valuation History

Current multiple vs historical range at each filing date. Band spans 25th-75th percentile.

P / E

Price / diluted EPS

4.2xCheap
4.2xmed 13.8x69.1x

P / S

Price / revenue per share

0.6xExpensive
0.2xmed 0.5x0.6x

P / B

Price / book value per share

1.6xFair
0.9xmed 1.5x1.6x

P / GP

Price / gross profit per share

2.8xCheap
2.0xmed 3.1x4.3x

P / FCF

Price / free cash flow per share

20.6xExpensive
3.2xmed 5.2x85.3x

Operating margin expansion and free cash flow are the primary reads at this stage.

Profitability

Gross profitability (GP / assets)

0.12

Primary signal (Novy-Marx).

5th of 6 SIC 33 peers

Return on equity

1.9%

Gross margin

15.6%

5th of 6 SIC 33 peers

Revenue growth (YoY)

23.7%

Gross margin improving

Margin trend vs prior year.

PASS

Operating Leverage

2011202020212022
Revenue vs COGS
Revenue vs OpEx
Op. Income vs Revenue

Growth

Revenue CAGR (3Y)

-4.4%

Revenue CAGR (5Y)

7.3%

Earnings CAGR (3Y)

-58.9%

FCF CAGR (3Y)

7.6%

Anti-fragile safety

Balance-sheet safety

Composite anti-fragile check.

PASS

Debt / equity

1.16

4th of 6 SIC 33 peers (best = lowest)

Current ratio

2.33×

5th of 6 SIC 33 peers

Quick ratio

1.31×

Net cash

-$2.64B

Cash & equivalents minus total debt.

Cash-flow health

Free cash flow

$312.25M

Operating cash flow minus capex.

Positive free cash flow

PASS

FCF / net income

2.69

Cash-backing of earnings.

FCF/NI divergence

Unfavorable divergence (yellow flag).

PASS

Accruals healthy

Cash-backed earnings.

PASS

SBC / revenue

0.5%

Stock-based comp intensity.

Dividend safety

Composite score

2.8 / 5

Fair
Payout ratio
96.2%1/5 Weak
FCF coverage
3.83×5/5 Strong
Dividend growth streak
9 yr4/5 Strong
Balance-sheet health
D/E 1.16 · IC N/A1/5 Weak

Piotroski F-Score

F-Score

7 / 9

Fundamental-strength score (0-9).

Lifecycle Phase History

20092022
Hypergrowth
Value
Capital Return