Core Viewpoint - Gerdau S.A. is positioned to benefit from ongoing investments in the automotive industry, electric vehicles, and electrical transmission renovations globally, indicating significant undervaluation in its stock price [3][26]. Company Overview - Gerdau S.A. is the largest Brazilian steel producer with over 100 years of experience in the industry, operating mills in multiple countries including Brazil, Canada, the U.S., and several Latin American nations [3][4][5]. - The company is also the largest recycling company in Latin America, which enhances its competitive position [5]. Financial Performance - In the last quarterly report, Gerdau reported an EPS GAAP of $0.07, beating expectations by $0.01, but revenue fell short by $10.55 million, totaling $2.94 billion [6][5]. - Analysts project revenue growth for 2026, 2027, and 2028, suggesting a positive long-term outlook [5]. Market Demand Drivers - Significant investments in electric vehicles and renewable energy are expected to drive steel demand, particularly in North America, Europe, and China [7][8]. - The automotive steel market was valued at approximately $112.93 billion in 2021, with a projected growth rate of over 3% from 2022 to 2030 [8]. Financial Health and Valuation - Gerdau has been reducing its total debt and liabilities, which has positively impacted its tangible book value per share [9][10]. - The company’s stock price is currently trading close to its book value per share, indicating potential undervaluation [10]. Cash Flow and Profitability - Gerdau has reported positive net income for the last six years and has maintained positive unlevered free cash flow, indicating a trend of increasing profitability [12]. - The company sold its equity interests in joint ventures for $325 million, which could enhance its cash position for future investments [13]. Currency Impact - The depreciation of the Brazilian real against stronger currencies could improve Gerdau's financials, as it receives payments in dollars and euros while incurring expenses in reais [14][15]. Debt Management - Gerdau's management has committed to maintaining a net debt/EBITDA ratio of 1.5x or lower, with a weighted average cost of debt around 5.4% [16]. Future Projections - Using a WACC of 15% and a perpetuity growth rate of 3%, the implied enterprise value is estimated at $15.75 billion, with a target stock price of $6.28 per share [20][22]. - Gerdau's valuation metrics indicate it is significantly undervalued compared to competitors, with a P/E ratio of 7.80 compared to a sector median of 18.53 [23].

Gerdau S.A. (NYSE:GGB) Q2 2024 Earnings Conference Call August 1, 2024 11:00 AM ET Company Participants Mariana Velho Dutra - Head, IR Gustavo Werneck - CEO Rafael Japur - CFO Conference Call Participants Daniel Sasson - Itau BBA Marcio Farid - Goldman Sachs Leonardo Correa - BTG Pactual Rafael Barcellos - Bradesco BBI Rodolfo De Angele - JPMorgan Carlos de Alba - Morgan Stanley Caio Ribeiro - Bank of America Ricardo Monegaglia - Safra Bank Lucas Laghi - XP Yuri Pereira - Santander Igor Guedes - Genial Mari ...

Gerdau (GGB) has been beaten down lately with too much selling pressure. While the stock has lost 19.7% over the past four weeks, there is light at the end of the tunnel as it is now in oversold territory and Wall Street analysts expect the company to report better earnings than they predicted earlier. reverse soon for reaching the old equilibrium of supply and demand. We use Relative Strength Index (RSI), one of the most commonly used technical indicators, for spotting whether a stock is oversold. This is ...

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today. Investors should also recognize that GGB has a P/B ratio of 0.65. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total l ...

Investors in Gerdau S.A (GGB) need to pay close attention to the stock based on moves in the options market lately. That is because the Jun 21, 2024 $2.00 Call had some of the highest implied volatility of all equity options today. What is Implied Volatility? Implied volatility shows how much movement the market is expecting in the future. Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It could also mean ...

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies. Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors rely o ...

Gustavo, I just have a very quick follow-up. The chance of being a ground field is zero, right? We are talking about a new plant, you will not operate as part of a unit you already have? Gustavo Werneck No, special to investments, Rodolfo. They are very different from traditional investments or long steel investments. Just to certify a plant like that, to start supplying to a customer, it takes two years and that requires a very specific expertise. It's not for anyone to do it. And the synergy will come fro ...

G E R D A U S . A . C o n d e n s e d c o n s o l i d a t e d i n t e r i m fi n a n c i a l s t a t e m e n t s a s o f M a r c h 3 1, 2 0 2 4 The accompanying notes are an integral part of these Condensed Consolidated Interim Financial Statements GERDAU S.A. CONSOLIDATED BALANCE SHEETS In thousands of Brazilian reais (R$) (Unaudited) | | Note | March 31, 2024 | December 31, 2023 | | --- | --- | --- | --- | | CURRENT LIABILITIES | | | | | Trade accounts payable - domestic market | 11 | 4,250,799 | 4,120,70 ...

Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics a ...

Momentum investing is essentially the opposite of the tried-and-tested Wall Street adage -- "buy low and sell high." Investors following this investing style typically avoid betting on cheap stocks and waiting long for them to recover. They believe instead that one could make far more money in lesser time by "buying high and selling higher."Everyone likes betting on fast-moving trending stocks, but it isn't easy to determine the right entry point. These stocks often lose momentum when their future growth po ...