Gerdau SA (ADR) (NYSE:GGB) Continues To Trade In Narrow Range


Dallas, Texas 10/10/2013 (Financialstrend) – The stock of $13.45 billion market cap Brazilian steel and iron manufacturer Gerdau SA (ADR) (NYSE:GGB) has managed to rise by 1.28% on October 9. This is in spite of not so great performance from its United States entity. In the past 30 days the stock has rallied up by close to 4.63%. This build up in momentum was carried forward in last week’s trading when the stock gained by close to 3%.

This market resurgence is fuelled by the pickup in demand for steel from Brazil based auto manufactures in tandem with their aero industry. The quantity demand has also coincided with a decent build up in price of steel leading to a healthy performance for the Brazilian arm of Gerdau.

Gerdau runs the fourth-largest steel manufacturing operations within United States. It has a annual production capacity of close to 11 million tons. The relative weakness in demand for steel in United States is likely to be the reason behind the company’s moderate forecast for the next calendar year.

As of close of business on October 9, the stock of this steel manufacturer was trading at $7.91 per share which is up 1.28% from its previous day close. At current valuations, the stock is trading 18% below its 52 week high valuations and is up 50% from its 52 week low pricing bench mark.

Over the past 12 months trailing period, the steel firm has managed to post sales of $17.1 billion which has resulted in income of $487 million over the same period. Compared to other steel makers the Brazilian firm’s dividend payout plan is conservative. In the past 12 months, total of $0.04 dividend is paid out translating to a 0.51% per share. The stock has total shares outstanding of 41.7 billion.