10:10 AM EDT, 03/31/2025 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We decrease our 12-month target price by $6 to $56, which values CMC at an EV/EBITDA of 6.5x our FY26 (Aug.) EBITDA estimate, above CMC's three-year avg. forward EV/EBITDA of 5.7x but below peers' avg. forward EV/EBITDA of 8.8x. We lower our FY25 EPS estimate by $0.28 to $3.02 and our FY26 EPS estimate by $0.26 to $4.42. Our three-stage DCF model supports our buy opinion, with a computed intrinsic value also of $56, which assumes a WACC of 8.3% and a stage-two free cash flow growth rate of 3.0%. Our DCF model indicates that CMC is currently trading at a valuaion that implies a 10-year CAGR in free cash flow of negative 2.5%, which is far too pessimistic, in our view. We think the pricing environment improved modestly during FQ2 and we are expecting the construction pipeline to remain robust (amid strong pent-up demand), which should result in a positive inflection point in metal margins during FQ3 in North America. We also anticipate continued improvements in Europe, which achieved EBITDA breakeven during FQ2.

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