CMC Should I Buy
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Commercial Metals Co (CMC) is not a strong buy at the moment for a beginner investor with a long-term focus. While the stock has positive analyst ratings and price targets, the recent financial performance, particularly the significant drop in net income and EPS, raises concerns. Additionally, technical indicators are mixed, and there are no strong proprietary trading signals or recent news catalysts to support an immediate buy decision. Holding off for now and monitoring further developments would be prudent.
The stock's MACD is negative and expanding, indicating bearish momentum. RSI is neutral at 42.785, suggesting no clear signal. Moving averages are bullish (SMA_5 > SMA_20 > SMA_200), but the stock is trading below the pivot level of 80.664, with key support at 77.157 and resistance at 84.17.
Analysts have raised price targets to $85, citing strong shipment volumes, favorable domestic market conditions, and potential cost savings. Steel tariffs remain firm, supporting elevated steel prices.
Net income and EPS have dropped significantly YoY (-200.89% and -202.60%, respectively). The MACD indicates bearish momentum, and there is no recent news or significant trading trends from hedge funds or insiders.
In Q1 2026, revenue increased by 11.03% YoY to $2.12 billion, and gross margin improved to 19.2% (+19.11% YoY). However, net income dropped by 200.89% YoY to $177.28 million, and EPS fell by 202.60% YoY to 1.58.
Analysts are bullish on CMC, with recent upgrades and price target increases to $85. They cite strong shipment volumes, cost-saving initiatives, and favorable market conditions as key drivers. However, muted demand outlook and macroeconomic challenges remain concerns.
