- Gerdau’s net revenue for the first quarter was R$17.38 billion, surpassing estimates of R$16.95 billion, representing a 7.2% increase year over year.
- The company sold 2.86 million tons of steel, marking a 4.9% increase compared to the previous year.
- Steel production declined by 3.4%, amounting to 2.99 million metric tons.
- The adjusted EBITDA margin decreased to 13.8% from 17.4% in the previous year.
- Adjusted EBITDA was R$2.40 billion, a decrease of 15% year over year, but above estimates of R$2.33 billion.
- Operating income fell by 50% to R$1.39 billion, slightly below estimates of R$1.41 billion.
- Net debt to adjusted EBITDA ratio stood at 0.69 times, higher than the estimated 0.57 times.
- Total net debt was R$7.64 billion.
- The company experienced a negative free cash flow of R$1.25 billion during the quarter.
- Analyst ratings include 13 buy recommendations and 5 hold recommendations, with no sell recommendations.
A look at Gerdau Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 5 | |
| Dividend | 4 | |
| Growth | 2 | |
| Resilience | 3 | |
| Momentum | 2 | |
| OVERALL SMART SCORE | 3.2 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Analysts foresee a positive long-term outlook for Gerdau based on the Smartkarma Smart Scores. The company has been rated highly for its strong value proposition, indicating that it may be undervalued in the market. Additionally, Gerdau scores well in terms of dividend payout, showing a commitment to rewarding its investors. However, there are lower scores for growth potential and momentum, suggesting some challenges in these areas. Despite this, Gerdau demonstrates resilience, which could help weather potential economic fluctuations. With operations spanning across the Americas, Europe, and Asia, Gerdau’s Mini Mill manufacturing process, which transforms scrap into steel, underpins its strategic manufacturing approach.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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