One of the main qualities I look for in downstream companies like Constellium SE ( CSTM ) is the ability to pass on input costs to customers, taking no hit on the income statementMy name is Andres Veurink and I have been in the financial markets for over a decade at this point, spending the majority of that in a hedge fund here in Rotterdam, working my way up as an analyst. My work relfect rigourious standards as I myself have a very high standard as to what I invest my money in. My preferred sectors to fol ...

With a degree in Finance and Accounting and previous experience in financial advisory, I use The Sharpe Quest to share my path as an independent investor and market analyst. My approach mixes long-term conviction holdings with tactical sector rotations, driven by the belief that investing isn’t about being right, it’s about making money. I focus on undercovered opportunities and momentum-driven sectors. All views are my own and not financial advice.Analyst’s Disclosure: I/we have no stock, option or similar ...

Market Overview - U.S. stocks are expected to have a volatile start in 2026, while European markets are performing strongly, with the STOXX 600 index up over 4% year-to-date compared to the S&P 500's flat performance [1] - European governments are increasing spending and anticipating economic growth, which may lead to U.S. stocks lagging behind their European counterparts [1] Leading European Stocks - Five European stocks are highlighted for their bullish trends in 2026, each with a Benzinga Edge Momentum Score of at least 90 [2] Rio Tinto - Rio Tinto has a Benzinga Edge Momentum Rating of 90.03 and is a diversified mining company focusing on iron ore, copper, aluminum, diamonds, and gold [3] - The stock has increased over 35% in the last three months, trading at 12.5 times forward earnings and 2.8 times sales, with a 4% dividend supported by a 64% payout ratio [3] ASML Holdings - ASML Holdings, rated 95.44, is a crucial technology company in Europe, known for its EUV machines that cost over $300 million each and cannot be replicated [4] - The company sells approximately 40 units annually, with a backlog exceeding a year of revenue, despite a high valuation of 43 times forward earnings and 14 times sales [5] - ASML shares are in a strong uptrend, with recent volatility helping to stabilize after a nearly 30% gain in January [6] TechnipFMC - TechnipFMC has a Benzinga Edge Momentum Rating of 92.88, with a highly anticipated Q4 2025 earnings release on February 19, following its highest EPS of $0.75 per share in over a decade reported in Q3 2025 [7] Schmid Group - Schmid Group has a Benzinga Edge Momentum Rating of 99.04 [9] Constellium - Constellium, rated 95.10, is a diversified aluminum products manufacturer with a market capitalization of $3 billion [9] - The company received an upgrade from Wells Fargo, raising its price target to $25, indicating over 45% upside potential [10] - CSTM shares have been trending upward since last summer, with a catalyst coming from its Q4 2025 earnings report scheduled for February 18, where analysts expect $1.9 billion in revenue and EPS of $0.32 [11]

Core Viewpoint - Constellium SE will announce its fourth quarter and full year 2025 results during a conference call on February 18, 2026, at 10:00 AM Eastern Time [1] Group 1: Conference Call Details - The conference call will be hosted by CEO Ingrid Joerg and CFO Jack Guo [1] - Details for the conference call, webcast, and accompanying presentation will be available on the Constellium Investor Relations page [2] - An archived recording of the conference call will be accessible for three weeks on the company’s website [2] Group 2: Company Overview - Constellium is a global leader in developing innovative, value-added aluminum products for various markets, including aerospace, packaging, and automotive [3] - The company generated $7.3 billion in revenue in 2024 [3]

Group 1 - Constellium (NYSE:CSTM) is identified as a cheap stock with potential for growth over the next three years, with Deutsche Bank raising its price target from $22 to $25 while maintaining a Hold rating [1][3] - In Q3 2025, Constellium reported a 20% year-over-year revenue increase to $2.2 billion, with net income rising to $88 million from $8 million in the same period last year [3] - Total shipments increased by 6% to 373,000 metric tons, attributed to operational improvements at the Muscle Shoals facility and strong demand in the packaging sector [3] Group 2 - CEO Jean-Marc Germain indicated that while scrap spreads had been a challenge year-to-date, they are beginning to widen, potentially impacting financial performance by $15 million to $20 million per quarter [2] - The company anticipates that the widening scrap spreads will provide a positive impact in Q4 and throughout 2026, despite not fully benefiting in Q3 due to staggered purchasing agreements [2] Group 3 - Constellium designs, manufactures, and sells rolled and extruded aluminum products for various end-markets, including aerospace, packaging, automotive, commercial transportation, general industrial, and defense [4]

Core Insights - U.S. stock futures are lower, with Nasdaq 100 futures down approximately 150 points [1] Group 1: Oxford Industries, Inc. - Oxford Industries reported a quarterly loss of 92 cents per share, which was better than the analyst consensus estimate of a loss of 95 cents per share [2] - The company reported quarterly sales of $307.344 million, exceeding the analyst consensus estimate of $304.642 million [2] - Shares of Oxford Industries fell 25.6% to $30.17 in pre-market trading following the earnings report and lowered guidance [2] Group 2: Other Stocks - CapsoVision Inc shares dropped 16.6% to $9.86 in pre-market trading after a previous gain of 33% [3] - Ur-Energy Inc fell 12.1% to $1.20 after announcing a $100 million offering of 4.75% convertible senior notes due 2031 [3] - Oracle Corporation shares dipped 11.3% to $197.70 after posting mixed second-quarter financial results for fiscal 2026 [3] - T1 Energy Inc. fell 10.8% to $5.50 after announcing proposed offerings of $120 million in convertible senior notes and $140 million in common stock [3] - Rezolute Inc dropped 5.8% to $10.30 after announcing Phase 3 study results [3] - NovaBay Pharmaceuticals Inc declined 5.8% to $2.28 after a previous jump of 34% [3] - Constellium SE fell 3% to $17.62 after gaining 4% [3]

Core Insights - Constellium SE has inaugurated new finishing lines at its Singen plant in Germany, completing a €30 million investment in collaboration with Lotte Infracell to produce high-quality aluminum foilstock for battery applications in Europe [1][2] Investment and Project Execution - The project was completed safely, on schedule, and within budget, with construction finishing in April 2025 and the first coil produced in November 2025 [2] - The new facility includes advanced edge trimming and packing lines, enhancing production capabilities and efficiency [3] Production Capabilities - The finishing lines can process aluminum coils with widths up to 2,000 mm and thicknesses of 1.3 mm, catering to various market segments with high productivity [3] Sustainability Initiatives - A solar power system installed at the site is expected to generate approximately 760,000 kWh of renewable energy annually, contributing to a reduced carbon footprint [4] Strategic Importance - The new capacity reinforces Constellium's role in supporting the transition to e-mobility and sustainable energy applications, positioning Singen as a center of excellence for high-performance aluminum products [5] Company Overview - Constellium is a global leader in developing innovative aluminum products for diverse markets, generating $7.3 billion in revenue in 2024 [6]

Core Viewpoint - Constellium (CSTM) is recommended as a Buy due to its transition from a cyclical, highly leveraged phase to a stronger, cash-generating profile, supported by aerospace recovery, resilient packaging demand, and a more normalized cost environment [1] Group 1: Company Transition - The company is moving away from its historical, cyclical, and highly leveraged phase [1] - Constellium is expected to benefit from an aerospace recovery and resilient demand in packaging [1] - The cost environment is becoming more normalized, which supports the company's transition [1] Group 2: Financial Performance - EBITDA is already showing signs of inflection, indicating improved financial performance [1]

Core Insights - Constellium SE is a significant player in the metal products distribution industry, particularly in aluminum production, with strong market presence in aerospace, automotive, and packaging sectors [1] Financial Performance - The company reported earnings per share (EPS) of $0.627, exceeding the estimated $0.315, resulting in an earnings surprise of 67.57% [2] - Revenue for the third quarter reached approximately $2.166 billion, surpassing the estimated $1.788 billion, representing a 2.87% beat over the Zacks Consensus Estimate [3] - Adjusted EBITDA was reported at $235 million, with contributions from Aerospace & Transportation ($90 million) and Packaging & Automotive Rolled Products ($82 million) [4][6] Strategic Initiatives - The company repurchased 1.7 million shares for $25 million, indicating a commitment to enhancing shareholder value [5] - Financial metrics include a P/E ratio of 49.46, a debt-to-equity ratio of 2.60, and a current ratio of 1.23, reflecting its valuation and financial structure [5]

Revenue and Sales Performance - Revenue for Q3 2025 increased by 20% to $2,166 million compared to $1,802 million in Q3 2024, driven by higher shipments and revenue per ton [121]. - Sales volumes for Q3 2025 rose by 6% to 373 kt from 352 kt in Q3 2024, with a 4% increase in A&T, 5% in P&ARP, and 14% in AS&I [121]. - For the three months ended September 30, 2025, total revenue increased 20% to $2,166 million from $1,802 million for the same period in 2024 [139]. - For the nine months ended September 30, 2025, revenue increased by 11% to $6,248 million from $5,614 million in the same period of 2024 [122]. - For the three months ended September 30, 2025, revenue in the AS&I segment increased 27% to $409 million from $323 million for the same period in 2024 [144]. Cost and Expenses - Cost of sales for Q3 2025 increased by 16% to $1,852 million from $1,597 million in Q3 2024, primarily due to a 21% rise in raw materials and consumables [125]. - Selling and administrative expenses for Q3 2025 rose by 29% to $85 million from $66 million in Q3 2024, driven by increased labor costs [127]. - Research and development expenses for Q3 2025 increased by 9% to $12 million from $11 million in Q3 2024, primarily due to foreign exchange translation impacts [129]. - For the nine months ended September 30, 2025, research and development expenses decreased 5% to $37 million from $39 million for the same period in 2024 [130]. Profitability and Income - Net income for Q3 2025 was $88 million, up from $8 million in Q3 2024, reflecting improved operational performance [120]. - For the nine months ended September 30, 2025, Adjusted EBITDA was $566 million, compared to $498 million for the same period in 2024 [182]. - For the three months ended September 30, 2025, Adjusted EBITDA in the A&T segment increased 67% to $90 million from $54 million for the same period in 2024 [150]. - For the nine months ended September 30, 2025, Adjusted EBITDA in the P&ARP segment increased 17% to $217 million from $186 million for the same period in 2024 [153]. - For the nine months ended September 30, 2025, Adjusted EBITDA in the AS&I segment decreased by 4% to $67 million from $70 million for the same period in 2024 [156]. Taxation - For the nine months ended September 30, 2025, income tax expense was $82 million compared to $46 million for the same period in 2024 [137]. - The effective tax rate for the three months ended September 30, 2025 was 30.2%, down from 57.9% for the same period in 2024 [137]. Share Repurchase and Capital Management - The company repurchased 1.7 million shares for $25 million during the third quarter [104]. - During the nine months ended September 30, 2025, the company repurchased 6.5 million shares for $75 million [172]. - Total liquidity at September 30, 2025, was $831 million, comprised of $122 million in cash and cash equivalents and $471 million of availability under the Pan-U.S. ABL facility [164]. Cash Flow and Capital Expenditures - Net cash flows from operating activities for the nine months ended September 30, 2025, were $271 million, a $31 million increase from $240 million in the same period in 2024 [167]. - Capital expenditures for the nine months ended September 30, 2025, were $203 million, compared to $255 million for the same period in 2024 [170]. Other Financial Impacts - The company experienced a $10 million negative impact from flooding in Valais, Switzerland, during the nine months ended September 30, 2024 [156]. - For the nine months ended September 30, 2025, the company reported $9 million in insurance proceeds and $8 million in clean-up costs due to flooding in Valais, Switzerland [184]. - For the nine months ended September 30, 2024, the company incurred $6 million in inventory impairment and $4 million in costs related to non-recurring corporate transformation projects [184]. - The company recognized a $2 million gain from acquiring non-controlling interests in Railtech Alu-Singen during the nine months ended September 30, 2024 [184]. - Metal price lag represents a non-cash financial impact due to timing differences between aluminum prices in revenue and purchase prices in cost of sales [184]. - The calculation of metal price lag is based on a standardized methodology applied at each manufacturing site, reflecting the average value of products purchased and inventory [184]. Demand Outlook - The company expects demand trends to remain stable through the remainder of 2025, benefiting from improved scrap spreads in North America [104]. Working Capital Changes - Changes in working capital for the nine months ended September 30, 2025, included an increase in inventory of $109 million and an increase in trade receivables of $280 million [168].