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Gerdau (GGB) Dips More Than Broader Markets: What You Should Know

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In the latest trading session, Gerdau (GGB - Free Report) closed at $5.41, marking a -1.64% move from the previous day. This change lagged the S&P 500's daily loss of 1.53%. Meanwhile, the Dow lost 1.72%, and the Nasdaq, a tech-heavy index, lost 3.27%.

Prior to today's trading, shares of the steel producer had lost 8.33% over the past month. This has lagged the Basic Materials sector's loss of 0.06% and the S&P 500's loss of 1.28% in that time.

Wall Street will be looking for positivity from Gerdau as it approaches its next earnings report date. On that day, Gerdau is projected to report earnings of $0.27 per share, which would represent a year-over-year decline of 27.03%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.69 billion, down 4.55% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.53 per share and revenue of $16.38 billion. These totals would mark changes of -8.93% and +2.62%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for Gerdau. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 5.79% lower within the past month. Gerdau is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that Gerdau has a Forward P/E ratio of 6.15 right now. This represents a discount compared to its industry's average Forward P/E of 10.82.

The Steel - Producers industry is part of the Basic Materials sector. This group has a Zacks Industry Rank of 22, putting it in the top 9% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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