Gerdau S.A. Common Stock (GGB)

FairStock Score: 38/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I look at Gerdau as a cyclical steel maker, not a franchise. It sells rebars, bars, wire rods, plates, and special steels across Brazil, North America, and South America, and it owns iron ore mining operations. That scale and vertical integration help, but steel is still a commodity business; rivals can match product, and pricing follows global supply and demand. The latest reported quarter, fiscal Q2 2026, showed $17.9B of revenue, $1.5B of net income, and an 8.20% margin. That is decent profitability at the reported level, but the broader return numbers are weak: FairStock's ROE is 4.18% and ROCE is 5.03%, well below what I want from a durable industrial. The balance sheet is a positive, with debt-to-equity of 0.28 and a Piotroski F-Score of 9/9. Free cash flow is striking: $3.5B trailing twelve months, a 41.1% FCF yield on the $8.6B market cap. Valuation is mixed. At the 2026-10-13 close of $5.18, the P/B is 0.97, the Graham Number is $11.62, implying a 55.42% margin of safety, and EV/EBITDA is 2.06. Yet the P/E is 23.55, and the Altman Z-Score of 1.16 warns of financial fragility in a downturn. The PEG of 0.34 suggests the market may be discounting growth, but the provided data lack a multi-year filed history for a proper growth judgment. FairStock Score is 38/100, and Lynch category is none because only 0 years of filed results are available. I see an asset-rich, cash-generative cyclical that the market prices cheaply on assets and cash flow, but not on current earnings. I would want evidence that mid-cycle returns are durable before calling it a bargain.

In plain English: Gerdau is a steel producer with operations in Brazil, North America, and South America, making products for construction, cars, farming, and industry. In the latest reported quarter, fiscal Q2 2026, it earned $1.5B on $17.9B of revenue, and the balance sheet looks conservative. The stock price looks low compared with the company's accounting value and a simple value estimate, but profits have been weak relative to the size of the business.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer