Commercial Metals Company 's CMC fully-owned subsidiary, CMC Steel Fabricators, Inc., has acquired substantially all the assets of Continental Concrete Structures, Inc. ("CCS").
CCS, a fabricator of post-tensioning cable and other related products for commercial as well as public construction projects, has its facility in Alpharetta, GA. CCS offers professional design and value engineering services to the construction industry spread across North America. The company has an annual production capacity of 4 million feet of post tensioning cable as well as the ability to package the cable with engineering services, fabricated reinforcing steel and site placing.
CMC Steel Fabricators aims to create value for customers and the acquisition is in line with this objective. The post tensioning cable is expected to complement the company's current rebar fabrication business. The company's recognition as a favored supplier in the concrete reinforcing industry is likely to further improve post the acquisition.
Commercial Metals' shares have gained 71.73% year-to-date while the Zacks categorized 'Steel-Producers' industry has gained 86.75% over the same period.
In the fourth quarter of fiscal 2016, Commercial Metals reported earnings of a penny per share, lower than the prior fiscal year quarter earnings of 11 cents per share. Adjusted earnings of 22 cents per share also missed the Zacks Consensus Estimate of 28 cents. Reported earnings for the fiscal also declined to 62 cents per share from 84 cents per share earned in fiscal 2015.
Commercial Metals' Americas Fabrication segment recorded adjusted operating profit of $9.6 million for the fourth quarter of fiscal 2016, lower than the $18.7 million adjusted operating profit recorded in the fourth quarter of fiscal 2015. The decrease was primarily driven by 4% lower shipments as well as 9% lower average composite metal margin. The margin compression in the segment was due to selling prices decreasing more than material costs.
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Zacks Rank & Key Picks
Commercial Metals currently holds a Zacks Rank #3 (Hold).
Some better-ranked companies in the steel space include POSCO PKX , Grupo Simec S.A.B. de C.V. SIM and AK Steel Holding Corp. AKS .
POSCO has an expected long-term growth of 5% and sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Grupo Simec, with a Zacks Rank #2 (Buy), saw a positive earnings surprise of 258.82% in the last reported quarter.
AK Steel has an expected long-term growth of 5%. The company carries a Zacks Rank #2.
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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report AK STEEL HLDG (AKS): Free Stock Analysis Report POSCO-ADR (PKX): Free Stock Analysis Report GRUPO SIMEC SA (SIM): Free Stock Analysis Report COMMERCIAL METL (CMC): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research