Gerdau (NYSE:GGB) Stock Price Down 4.1% on Disappointing Earnings

Gerdau S.A. (NYSE:GGB)’s share price traded down 4.1% during mid-day trading on Wednesday following a weaker than expected earnings announcement. The company traded as low as $4.49 and last traded at $4.46. 1,301,824 shares were traded during trading, a decline of 92% from the average session volume of 17,069,439 shares. The stock had previously closed at $4.65.

The basic materials company reported $0.15 EPS for the quarter, missing the consensus estimate of $0.17 by ($0.02). The business had revenue of $3.61 billion during the quarter, compared to analysts’ expectations of $3.64 billion.

Gerdau Increases Dividend

The company also recently disclosed a quarterly dividend, which was paid on Friday, September 18th. Stockholders of record on Friday, August 21st were given a dividend of $0.0448 per share. This is a boost from Gerdau’s previous quarterly dividend of $0.0361. This represents a $0.18 dividend on an annualized basis and a dividend yield of 4.1%. The ex-dividend date was Friday, August 21st. Gerdau’s dividend payout ratio (DPR) is presently 53.57%.

Wall Street Analysts Forecast Growth

Several brokerages recently commented on GGB. Wall Street Zen raised Gerdau to a “strong-buy” rating in a research report on Saturday, October 17th. JPMorgan Chase & Co. lifted their price target on shares of Gerdau from $6.00 to $6.50 and gave the stock an “overweight” rating in a research note on Friday, September 4th. HSBC lowered shares of Gerdau from a “buy” rating to a “hold” rating in a report on Thursday, August 20th. The Goldman Sachs Group cut shares of Gerdau to a “neutral” rating in a research note on Monday, August 24th. Finally, Bank of America downgraded shares of Gerdau from a “buy” rating to a “neutral” rating and set a $5.10 price objective for the company. in a report on Thursday, August 20th. One analyst has rated the stock with a Strong Buy rating, three have issued a Buy rating and five have given a Hold rating to the company’s stock. Based on data from MarketBeat.com, the company has a consensus rating of “Moderate Buy” and a consensus target price of $5.57.

Insider Transactions at Gerdau

In related news, EVP Rafael Lopes sold 51,800 shares of the business’s stock in a transaction on Thursday, September 17th. The stock was sold at an average price of $5.09, for a total value of $263,662.00. Following the sale, the executive vice president owned 83,399 shares of the company’s stock, valued at $424,500.91. The trade was a 38.31% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, Chairman Claudio Johannpeter sold 85,607 shares of the company’s stock in a transaction on Wednesday, September 23rd. The shares were sold at an average price of $4.94, for a total value of $422,898.58. Additional details regarding this sale are available in the official SEC disclosure. In the last ninety days, insiders sold 147,407 shares of company stock valued at $737,561. Corporate insiders own 0.02% of the company’s stock.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently made changes to their positions in the stock. Allspring Global Investments Holdings LLC acquired a new stake in shares of Gerdau in the 1st quarter valued at $45,000. Bank of New York Mellon Corp acquired a new stake in shares of Gerdau during the 1st quarter worth about $46,000. Greenspring Advisors LLC acquired a new stake in shares of Gerdau during the 2nd quarter worth about $47,000. EverSource Wealth Advisors LLC lifted its holdings in Gerdau by 57.6% during the 1st quarter. EverSource Wealth Advisors LLC now owns 13,243 shares of the basic materials company’s stock valued at $48,000 after purchasing an additional 4,842 shares during the last quarter. Finally, J. Safra Sarasin Holding AG bought a new position in Gerdau during the 1st quarter valued at about $52,000. 1.49% of the stock is owned by institutional investors.

Gerdau Stock Down 4.8%

The stock has a market capitalization of $8.69 billion, a price-to-earnings ratio of 15.80 and a beta of 1.48. The stock’s 50-day simple moving average is $4.89 and its 200 day simple moving average is $4.45.

Gerdau Company Profile

Gerdau SA is a Brazil-based steel producer with operations across the Americas. The company manufactures and sells steel products for the construction, industrial, automotive, agricultural and infrastructure markets.

Its product portfolio includes long steel products such as rebar, wire rod, merchant bars and structural shapes, as well as special steel used in automotive and industrial applications. Gerdau also produces flat steel and semi-finished products, including billets and slabs, and operates steel mills, scrap-processing facilities and related distribution networks.

Founded in 1901, Gerdau has grown from a regional Brazilian steelmaker into an international producer serving customers in Brazil, North America and other parts of Latin America.