Commercial Metals Company

Commercial Metals Company expects its TAG Transform, Advance, Grow program to deliver run-rate gross EBITDA benefits exceeding $250 million by the end of fiscal 2026, rising to more than $350 million by the end of fiscal 2027. Launched in 2024, the program spans more than 150 individual projects across the company's business segments and support functions, aimed at optimizing logistics, reducing input consumption, lowering costs and boosting energy efficiency. Backed by the program, CMC expects fiscal 2029 core EBITDA of $1.65 billion to $1.80 billion, a 106% surge at the midpoint from the $837 million delivered in fiscal 2025, with a core EBITDA margin of 15-16%. Separately, Cleveland-Cliffs is investing $1 billion to modernize its Middletown Works facility in Ohio, half of it funded by a $500 million U.S. Department of Energy award, while Carpenter Technology set a fiscal 2029 operating income target of $1.2 billion to $1.3 billion, up from $702 million reported in fiscal 2026. The Zacks Consensus Estimate puts CMC's fiscal 2026 sales at $9.18 billion, up 13.9% year over year, and earnings at $6.62 per share, up 111.5%.

Nucor Corporation returned around $1.2 billion to shareholders in 2025 through dividends and share repurchases, representing nearly 70% of net earnings. Returns to shareholders were $254 million in the first quarter of 2026, and roughly $630 million year to date through June 17, 2026. The company ended the first quarter with strong liquidity of about $3.2 billion, including cash and cash equivalents of around $2.2 billion, and generated cash from operations of $886 million. Nucor raised its quarterly dividend to 56 cents per share in December 2025, marking 53 consecutive years of increases, and remains committed to returning at least 40% of earnings to shareholders. Among peers, Steel Dynamics bought back $115 million in shares in the first quarter and raised its dividend 6% to 53 cents per share, while Commercial Metals repurchased $18.9 million in shares during its fiscal third quarter and held its dividend at 20 cents per share.

Commercial Metals Company reported third-quarter sales of US$2,483.25 million and net income of US$173.02 million, exceeding analyst expectations. The company also affirmed a US$0.20 quarterly dividend and completed a multi-year US$721.11 million share repurchase program. Around the same time, CMC was added to several Russell Growth benchmarks, which may increase visibility among institutional investors and passive funds. Despite the stronger-than-expected results, the key catalyst remains sustaining margins in a choppy construction market, with risks from demand softness and competitive rebar supply pressuring pricing.

For the quarter ended May 2026, Commercial Metals reported revenue of $2.48 billion, up 22.9% over the same period last year, and EPS of $1.73 compared to $0.74 a year ago. Revenue exceeded the Zacks Consensus Estimate of $2.37 billion by 4.88%, while EPS beat the consensus of $1.60 by 8.13%. North America net sales from external customers reached $1.79 billion, above the $1.71 billion estimate, and Europe net sales were $291.24 million versus the $267.64 million estimate. Key metrics included North America steel products metal margin per ton of $610, compared to the $602.68 estimate, and Europe steel products metal margin per ton of $330, above the $316.21 estimate.

CMC reported third-quarter fiscal 2026 net earnings of $173.0 million, or $1.55 per diluted share, with adjusted earnings of $193.0 million, or $1.73 per diluted share. Consolidated core EBITDA surged 78.6% year-over-year to $353.6 million, driven by strong market conditions, growing benefits from Transform, Advance, Grow initiatives, and a $52.9 million contribution from recently acquired precast businesses. Core EBITDA margin expanded 440 basis points to 14.2%, while net leverage adjusted for acquisitions fell to 2.1 times, with clear visibility to below 2 times well ahead of the mid-2027 target. All segments delivered significant adjusted EBITDA growth, with North America Steel Group up 41%, Construction Solutions Group more than doubling, and Europe Steel Group rising to $34.7 million from $3.6 million a year earlier. The company also declared a quarterly dividend of $0.20 per share and expects sequential core EBITDA growth in the fourth quarter.

CMC's board of directors declared a regular quarterly cash dividend of $0.20 per share of common stock. This marks the company's 247th consecutive quarterly dividend, payable on July 15, 2026, to stockholders of record as of the close of business on July 6, 2026.

Morgan Stanley downgraded Cleveland-Cliffs to Equal-weight from Overweight, arguing that a supply-driven rally in U.S. steel prices is nearing its peak and that much of the benefit from elevated prices is already reflected in steel equities. The brokerage raised its near-term steel price forecasts after U.S. hot-rolled coil prices climbed to about $1,140 per short ton, supported by tight domestic supply, longer mill lead times, and higher import costs linked to Middle East disruptions, but it expects additional domestic production and rising imports to eventually ease the market, leading prices lower in 2027 and 2028. Morgan Stanley increased its price target on Cleveland-Cliffs to $12.50 from $12.00 but said the stock's roughly 50% rally since early April has left a more balanced risk-reward profile, with higher steel prices supporting near-term earnings but limited upside relative to peers. The bank now forecasts average hot-rolled coil prices of $1,112 per ton in 2026, $1,012 in 2027, and $900 in 2028, compared with previous estimates that were materially lower, and expects prices to remain elevated through the second half of 2026 before moderating as supply conditions normalize. Among North American steel producers, Morgan Stanley maintained an Overweight rating only on Commercial Metals Company, citing overly discounted concerns around new rebar supply, while keeping Equal-weight ratings on Nucor and Steel Dynamics and raising their price targets to $258 and $270, respectively. The firm also lifted its earnings forecasts across the sector to reflect stronger steel pricing, while cautioning that profitability is likely near a cyclical peak and could decline after 2027 as steel prices retreat from current levels.