On July 18, 2023, Barbara Smith, Chairman and CEO of Commercial Metals Co (CMC, Financial), sold 1700 shares of the company. This move is part of a larger trend of insider selling within the company over the past year.
Commercial Metals Co is a global, low-cost metals recycling, manufacturing, fabricating, and trading enterprise. With corporate headquarters in Irving, Texas, the company operates in more than 20 countries and has more than 21,000 employees worldwide. CMC's vertical integration model, from the recycling of scrap metals into steel and the fabrication of finished products, provides a competitive edge in the steel production industry.
Barbara Smith has been with Commercial Metals Co since 2011, serving in various roles including Chief Financial Officer and President before becoming Chairman and CEO. Her leadership has been instrumental in the company's growth and expansion into new markets.
Over the past year, Smith has sold a total of 176,700 shares and has not made any purchases. This trend is mirrored by other insiders within the company, with 12 insider sells and no insider buys over the same timeframe.
The stock price of Commercial Metals Co was $56.45 per share on the day of Smith's recent sell, giving the company a market cap of $6.494 billion. The price-earnings ratio is 6.87, lower than both the industry median of 10.88 and the company's historical median price-earnings ratio. This suggests that the stock is currently undervalued compared to its peers and its own historical performance.
However, the GuruFocus Value of Commercial Metals Co is $43.73, resulting in a price-to-GF-Value ratio of 1.29. This indicates that the stock is modestly overvalued based on its intrinsic value. The GF Value is calculated based on historical multiples, a GuruFocus adjustment factor, and future business performance estimates from Morningstar analysts.
The recent insider sell by Barbara Smith, along with the overall trend of insider selling within Commercial Metals Co, may raise questions among investors. However, it's important to consider these transactions in the context of the company's current valuation and future growth prospects. As always, investors should conduct their own due diligence before making investment decisions.
