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CMC, Commercial Metals

Steel capital-intensive Cyclical

We offer products and technologies to meet the critical reinforcement needs of the global construction sector.

CMC's solutions support early-stage construction across a wide variety of applications, including infrastructure, non-residential, residential, industrial and energy generation and transmission.

From our inception, our business model has been strategically built on sustainable principles, including recycling metals, manufacturing products from approximately 98% recycled material using energy-efficient technology and employing closed-loop water recycling processes.

Latest annual: FY2025 10-K

CMC · Commercial Metals

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$7.8B

−1.6% YoY · 7% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $8.9B 5-yr avg $8.0B

Gross margin 19% 5-yr avg 18%

Operating margin 7.6% 5-yr avg 9.4%

ROIC 8% 5-yr avg 14%

Owner-earnings margin 6% 5-yr avg 6%

Free cash flow margin 5% 5-yr avg 5%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

What it is: Revenue is North America Steel Group (79%), Europe Steel Group (12%) and Emerging Business Group (10%).
Situation: Cyclical. Margins collapse and recover repeatedly across the record; a single year, good or bad, misstates the through-cycle earning power.
What moves the needle: Gross margin has run about 16% and operating margin about 4.6% through the cycle, a thin spread that turns the result on volume and the cost of what it sells far more than on the price it sets. The margin is cyclical, swinging between 1.4% and 17% over the years, so the through-cycle figure carries more than any single year — and the balance sheet at the trough more than the peak. Inventory runs near 12% of sales, so how fast it turns back into cash — and the risk of writing it down when demand softens — sits alongside the margin. Read this kind of business on the commodity price and the cost position. On its own account, the filing leans hardest on pricing power & competition, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has sat near the cost of capital (median 9%). By owner earnings: roughly 6% of revenue reaches owners as cash, though it swings. The cycle and the balance sheet decide this one; the worst year tells more than the median, and the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

Where the money comes from

read the 10-K →

North America Steel Group is 79% of revenue, with Europe Steel Group the other meaningful segment at 12%.

Revenue by reportable segment, FY2025

North America Steel Group79%$6.2B
Europe Steel Group12%$921M
Emerging Business Group10%$806M
Corporate and Other-1%($80M)

By geographyUnited States80%Other12%Poland8%

From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMay 2026
											Income statement
$3.6B	$3.8B	$4.6B	$5.8B	$5.5B	$6.7B	$8.9B	$8.8B	$7.9B	$7.8B	$8.9B	RevenueRevenue
16%	14%	13%	14%	17%	16%	21%	21%	17%	16%	19%	Gross marginGross mgn
11%	10%	9%	8%	9%	8%	6%	7%	8%	9%	9%	SG&A / revenueSG&A/rev
$76M	$65M	$165M	$268M	$371M	$534M	$1.5B	$1.1B	$636M	$108M	$675M	Operating incomeOp. inc.
2.1%	1.7%	3.6%	4.6%	6.8%	7.9%	17.0%	12.8%	8.0%	1.4%	7.6%	Operating marginOp. mgn
$55M	$46M	$139M	$198M	$280M	$413M	$1.2B	$860M	$485M	$85M	$595M	Net incomeNet inc.
20%	25%	18%	26%	25%	23%	20%	23%	24%	21%	12%	Effective tax rateTax rate
											Cash flow & returns
$587M	($523M)	($434M)	$37M	$791M	$228M	$700M	$1.3B	$900M	$715M	$918M	Operating cash flowOp. cash
$127M	$125M	$132M	$159M	$166M	$168M	$175M	$219M	$280M	$286M	$355M	DepreciationDeprec.
$379M	($725M)	($728M)	($345M)	$314M	($396M)	($739M)	$205M	$89M	$307M	($79M)	Working capital & otherWC & other
$163M	$213M	$175M	$139M	$188M	$184M	$450M	$607M	$324M	$403M	$513M	CapexCapex
4.5%	5.5%	3.8%	2.4%	3.4%	2.7%	5.0%	6.9%	4.1%	5.2%	5.8%	Capex / revenueCapex/rev
$460M	($648M)	($566M)	($102M)	$604M	$44M	$525M	$1.1B	$575M	$429M	$563M	Owner earningsOwner earn.
12.8%	−16.9%	−12.2%	−1.7%	11.0%	0.7%	5.9%	12.8%	7.3%	5.5%	6.4%	Owner earnings marginOE mgn
$424M	($736M)	($609M)	($102M)	$604M	$44M	$250M	$737M	$575M	$312M	$405M	Free cash flowFCF
11.8%	−19.2%	−13.1%	−1.7%	11.0%	0.7%	2.8%	8.4%	7.3%	4.0%	4.6%	Free cash flow marginFCF mgn
$0	$56M	$7M	$701M	$18M	$2M	$552M	$235M	$0	$0	$2.5B	AcquisitionsAcquis.
$55M	$56M	$56M	$57M	$57M	$58M	$68M	$75M	$79M	$81M	$82M	Dividends paidDiv. paid
$31M	$0	$0	—	$0	$0	$162M	$101M	$183M	$199M	—	BuybacksBuybacks
3%	2%	7%	7%	11%	14%	27%	18%	10%	2%	8%	ROICROIC
4%	3%	9%	12%	15%	18%	37%	21%	11%	2%	13%	Return on equityROE
−0%	−1%	6%	9%	12%	15%	35%	19%	9%	0%	11%	Retained to equityRetained/eq
											Balance sheet
$518M	$253M	$622M	$192M	$542M	$498M	$673M	$592M	$858M	$1.0B	$560M	Cash & investmentsCash+inv
$689M	$561M	$749M	$1.0B	$881M	$1.1B	$1.4B	$1.2B	$1.2B	$1.2B	$1.4B	ReceivablesReceiv.
$540M	$463M	$589M	$692M	$625M	$935M	$1.2B	$1.0B	$972M	$934M	$1.2B	InventoryInvent.
$208M	$226M	$261M	$288M	$266M	$451M	$428M	$364M	$351M	$358M	$458M	Accounts payablePayables
$1.0B	$798M	$1.1B	$1.4B	$1.2B	$1.6B	$2.1B	$1.9B	$1.8B	$1.8B	$2.1B	Operating working capitalOper. WC
$2.0B	$1.7B	$2.1B	$2.1B	$2.2B	$2.7B	$3.4B	$3.1B	$3.3B	$3.5B	$3.5B	Current assetsCur. assets
$821M	$608M	$542M	$695M	$745M	$980M	$1.4B	$844M	$835M	$1.3B	$1.5B	Current liabilitiesCur. liab.
2.5×	2.8×	3.8×	3.0×	3.0×	2.8×	2.5×	3.7×	3.9×	2.8×	2.3×	Current ratioCurr. ratio
$66M	$65M	$64M	$64M	$64M	$66M	$249M	$386M	$386M	$387M	$2.1B	GoodwillGoodwill
$3.1B	$3.0B	$3.3B	$3.8B	$4.1B	$4.6B	$6.2B	$6.6B	$6.8B	$7.2B	$9.8B	Total assetsAssets
$1.1B	$832M	$1.2B	$1.3B	$1.1B	$1.1B	$1.8B	$1.2B	$1.2B	$1.4B	$3.4B	Total debtDebt
$558M	$579M	$548M	$1.1B	$550M	$582M	$1.2B	$573M	$340M	$321M	$2.9B	Net debt / (cash)Net debt
1.2×	1.5×	4.0×	3.8×	6.0×	10.3×	29.9×	28.0×	13.3×	—	14.1×	Interest coverageInt. cov.
$1.4B	$1.4B	$1.5B	$1.6B	$1.9B	$2.3B	$3.3B	$4.1B	$4.3B	$4.2B	$4.5B	Shareholders’ equityEquity
0.7%	0.8%	0.5%	0.4%	0.6%	0.6%	0.5%	0.7%	0.6%	0.5%	0.5%	Stock comp / revenueSBC/rev
											Per share
117M	117M	118M	119M	120M	122M	122M	119M	117M	114M	112M	Shares out (diluted)Shares
$30.83	$32.75	$39.31	$48.93	$45.52	$55.17	$72.84	$74.19	$67.66	$68.36	$79.03	Revenue / shareRev/sh
$0.47	$0.39	$1.17	$1.66	$2.32	$3.38	$9.95	$7.25	$4.14	$0.74	$5.31	EPS (diluted)EPS
$3.94	$-5.52	$-4.79	$-0.85	$5.02	$0.36	$4.29	$9.49	$4.91	$3.76	$5.03	Owner earnings / shareOE/sh
$3.63	$-6.27	$-5.15	$-0.85	$5.02	$0.36	$2.05	$6.22	$4.91	$2.74	$3.62	Free cash flow / shareFCF/sh
$0.47	$0.47	$0.47	$0.47	$0.47	$0.47	$0.55	$0.63	$0.67	$0.71	$0.73	Dividends / shareDiv/sh
$1.40	$1.82	$1.48	$1.17	$1.56	$1.51	$3.68	$5.11	$2.77	$3.53	$4.58	Cap. spending / shareCapex/sh
$11.72	$11.94	$12.64	$13.63	$15.70	$18.81	$26.85	$34.74	$36.70	$36.75	$40.47	Book value / shareBVPS

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+9.2%/yr	+8.5%/yr
Owner earnings / share	−0.5%/yr	−5.6%/yr
EPS	+5.2%/yr	−20.4%/yr
Dividends / share	+4.6%/yr	+8.5%/yr
Capital spending / share	+10.8%/yr	+17.8%/yr
Book value / share	+13.5%/yr	+18.5%/yr

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked.

Share count

114Mpeak FY2022

ROIC

2%low FY2025

Gross margin

16%low FY2018

Net debt ÷ owner earnings

0.7×peak FY2021

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$429Mowner earningsvs.$85Mnet incomelow FY2017

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cash

Each year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.

FY2016FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business earned $429M of owner earnings, the operating cash left after the $286M it takes just to hold its position. It put $117M more into growth; free cash flow, after that spending, was $312M.

Reported net income$85M

Owner earnings$429M · 6% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$85M	$485M	$860M	$1.2B	$413M
Depreciation & amortizationnon-cash charge added back	+$286M	+$280M	+$219M	+$175M	+$168M
Stock-based compensationreal costnon-cash, but a real cost	+$37M	+$45M	+$61M	+$47M	+$44M
Working capital & othertiming of cash in and out, other non-cash items	+$307M	+$89M	+$205M	−$739M	−$396M
Cash from operations	$715M	$900M	$1.3B	$700M	$228M
Maintenance capital expenditurethe spending needed just to hold position and volume	−$286M	−$324M	−$219M	−$175M	−$184M
Owner earnings	$429M	$575M	$1.1B	$525M	$44M
Growth capital expenditurediscretionary; spent to get bigger, not to stand still	−$117M	—	−$388M	−$275M	—
Free cash flow	$312M	$575M	$737M	$250M	$44M
Owner-earnings marginowner earnings ÷ revenue	6%	7%	13%	6%	1%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the maintenance capital it must spend to hold its position (here about $286M, roughly its depreciation, the rate its assets wear out). The other $117M of its capital spending is growth it chose, not upkeep it owed; charged only with the maintenance it must do, the business earns well more than the year's free cash flow shows. The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $37M), owner earnings is nearer $392M.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? 2.2×

Adequate

Operating income $108M ÷ interest expense $48M

What this means
Comfortable in a normal year, but below the margin of safety Graham looked for. Worth checking how stable the coverage has been across a full cycle.
How heavy is the debt, net of cash? $321M · 3.0× operating profit

Meaningful net debt

Cash $1.0B − debt $1.4B

What this means
Netting $1.0B of cash and short-term investments against $1.4B of debt leaves $321M owed, about 3.0× a year's operating profit (12.7× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 88d

Long (60+ days)

DSO 56 + DIO 52 − DPO 20 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital 7%

Below average through the cycle

10-yr median, range 2%–27%; 2% latest = NOPAT $85M ÷ invested capital $4.5B

Industry peers: median 8%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 10 years (it ran 2% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 6%

Solid through the cycle

10-yr median margin, range -17%–13%; latest $429M = operating cash $715M − maintenance capex $286M

Industry peers: median 3%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 6% of revenue this year, a 6% median across 10 years. It chose to put $117M more into growth, so free cash flow this year was $312M — the gap is investment, not weakness. Treating stock comp as the real expense it is (less $37M of SBC) leaves $392M.
Are earnings backed by cash? 8.45×

Cash-backed

Cash from ops $715M ÷ net income $85M

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? 65%

Returns about half

Dividends + buybacks $280M ÷ Owner Earnings $429M

What this means
Of $429M Owner Earnings, $280M (65%) went back to shareholders, $81M dividends, $199M buybacks. Net of $37M stock comp, the real buyback was about $162M. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
Investing or harvesting? 1.41×

Expanding

Capex $403M ÷ depreciation $286M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 6 of 6 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Pass

Revenue ≥ $2B · $7.8B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Pass

Current ratio ≥ 2× · 2.78×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Pass

Debt ≤ working capital · $1.4B vs $2.2B WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Pass

A profit every year (10-yr record) · no losses

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Pass

Uninterrupted dividends · paid every year (10)

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth Pass

Earnings +33% over the record · +497%

What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $4.31/share (latest year $0.77), the averaged base the calculator's gate runs on, and book value is $37.90/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 10 of 10

What this means
Never lost money over the record, the earnings stability Graham insisted on.
Return on capital ≥ 15% 2 of 10 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin 2% → 7% (3-yr avg ends)

In the filing’s words The margin widened even though the filing names price competition — the gain came from volume or cost, not pricing power. Read where.

What this means
Through the cycle the operating margin widened — about 2% early to 7% lately, median 5% — pricing power intact or improving.
Reinvestment, incremental ROIC 15%

What this means
Reinvested capital came back at only a modest incremental return — near the cost of capital, where extra growth adds little per dollar. The record shows whether it is a soft stretch or a thinning moat.
Worst year 2025 · 1.4% op. margin

What this means
Stayed profitable even in its hardest year, the resilience that survives recessions.
Share count −0.2%/yr

What this means
Roughly flat share count, little dilution, little buyback.
Dividend record rising

What this means
Paid and raised the dividend across the record, the continuity Graham prized.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

In its own filing Raised, but not as a competitor

The filing raises AI among its risks, but in other terms (security, regulation, energy or the like), not as a competitor to its product.

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, May 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$3.5B

Cash & short-term investments$560M
Receivables$1.4B
Inventory$1.2B
Other current assets$338M

Current liabilities$1.5B

Debt due within a year$89M
Accounts payable$458M
Other current liabilities$941M

Current ratio2.33×all current assets ÷ what's due · Graham looked for 2×

Quick ratio1.54×stricter: inventory excluded

Cash ratio0.38×strictest: cash alone against what's due

Working capital$2.0Bthe cushion left after near-term bills

Debt due this year vs. cash$89M due · $560M cash covered by cash on hand, no refinancing forced · both figures from the May 31, 2026 balance sheet

Revenue, latest quarter vs. a year ago+22.9%the freshest read on whether the business is still growing

Current ratio, recent quarters3.9× → 2.3×

Deeper floors

Tangible book value$1.9Bequity stripped of goodwill & intangibles

Net current asset value($1.8B)Graham's net-net: current assets less all liabilities

Debt incl. operating leases$3.5B$224M of it operating leases; with finance leases, “total fixed claims” below reaches $1.7B (annual-report basis)

Deferred revenue$21Mcustomer cash collected before delivery; operating float

From the company's latest filing.

Lease obligations

the lease note, SEC EDGAR →

Debt by another name. What the business owes on the property, aircraft, stores and equipment it rents rather than owns is a fixed claim due on a schedule; added back to the debt, it is the true leverage. That ladder, operating and finance leases together, and what it adds to the debt on the page above.

Operating leasesFinance leases

'26$95M

'27$87M

'28$71M

'29$48M

'30$28M

later$50M

Lease payments by year, scaled to the largest; “later” is everything beyond year five, shown apart. These are the contractual cash payments, before the interest the filing imputes back out to the balance-sheet liability.

Due in the next 12 months$95Ma fixed cash payment, owed whether or not the business has a good year

Total lease payments$378Mevery year plus the tail, undiscounted: the full cash the leases will take

On the balance sheet$333Mthe present value of those payments, the recognised lease liability

True leverage: debt plus leases

On-balance-sheet debt$1.4B

Lease obligations (present value)$333M

Total fixed claims on the business$1.7B

Counting the leases the way Buffett does, the fixed claims on this business come to $1.7B, of which the leases are 20%. The lease wall above and the debt schedule together are the calendar of what must be paid, and when.

Lease ladder read from the ASC 842 tags in the company’s Aug 31, 2025 annual report and reconciled: the yearly buckets sum to the undiscounted total, which less the imputed interest equals the balance-sheet liability; a ladder that doesn’t tie out is withheld.

How the cash was used, 2016–2025

Over the record, the business generated $4.3B of operating cash; how management split it reads as a reinvestor, most operating cash is plowed back into the business.

Reinvested$2.8B · 65%
Dividends$641M · 15%
Buybacks$676M · 16%
Retained (debt / cash)$183M · 4%

Returned to owners$1.3B
54% of the owner earnings the business produced over the span, $641M as dividends and $676M as buybacks.
Source of fundingOperating cash
Operating cash covered reinvestment and returns; over the span debt rose $2.4B and cash and short-term investments rose $42M.
Average price paid for buybacks$40.90
Across the years where the filing reports a share count, 17M shares were bought for $676M, about $40.90 each. Year to year the price paid ranged from $13.30 (2016) to $52.28 (2024); its heaviest year, 2025, paid $50.80 ($199M).
Net change in share count−4.0%
The diluted count fell from 117M to 112M, so the buybacks outran the stock issued to staff.
Dividend record$0.71/sh
Paid in 10 of the years on record, the per-share dividend growing about 5% a year. It was never cut over the span.
Return on what it retained39%
Of the earnings it kept rather than paid out ($2.5B over the span), annual owner earnings (first three years vs last three) grew $961M, so each retained $1 added about 0.39 of yearly owner earnings. Buffett's test, run on owner earnings instead of market value.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 10-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$598M8% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity9%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$1.6Bover 10 years buying other businesses, against $2.8B of capital spent building

$2M written down across 1 year (2017): goodwill the company has already conceded it overpaid for, charged against earnings. A write-down costs no cash (the cash went out when the deal was signed), but it is management marking its own past judgment to market.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 10-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Pay, as filed	“Actually paid”	Owner earnings
2021	$9.1M	$19.9M	$44M
2022	$10.2M	$20.0M	$525M
2023	$9.6M	$20.8M	$1.1B
2024	$6.6M	$6.8M	$575M
2025	$8.0M	$8.8M	$429M

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership<1%
The stake all directors and executive officers hold together, per the 2025 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio99:1
What the chief earns for every dollar the median employee makes, per the 2025 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$37M
The slice of the business handed to employees in shares this year, 0% of revenue, equal to 34% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Commercial Metals is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

2 of the 6 tests turned up something to look into; the other 4 came back clean.

Look hereDid debt outgrow the business?$1.1B → $3.4B
Debt rose from $1.1B to $3.4B while owner earnings went from about ($251M) to $710M: measured against what the business earns, the balance sheet carries more debt than it did. Debt raised for buybacks or deals rather than growth is the kind that bites in a downturn.
Look hereAre "one-time" charges a yearly habit?10 of 10 years
Management took an impairment or write-down in 10 of the last 10 years, $116M in all. A charge taken almost every year is not one-time; it is the business — past deals coming due, and an admission the assets were worth less than what was paid. Munger's rule: when the "one-time" keeps happening, it is the business. Read it beside the goodwill the company still carries.

And these came back clean

Is it less profitable than it was?
Did the share count rise anyway?
Did reported profit become cash?
Did receivables and inventory outpace sales?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

What an owner would ask, FY2025

read the 10-K →

Which reported numbers are a judgment call?
Management names Revenue recognition, Income taxes, Inventory, Acquisitions as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, Steel

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
STLDSteel Dynamics Inc.	$18.2B	16%	11.2%	17%	9%
XUnited States Steel	$15.6B	8%	3.0%	3%	3%
CSTMConstellium SE Ordinary Shares (France)	$8.4B	—	3.8%	9%	1%
HWMHowmet Aerospace	$8.3B	—	13.5%	9%	1%
CMCCommercial Metals	$7.8B	16%	5.7%	9%	6%
ATIATI Inc	$4.6B	15%	6.5%	8%	-0%
CRSCarpenter Technology	$2.9B	17%	6.0%	5%	5%
SXCSunCoke Energy Inc.	$1.8B	—	7.8%	8%	6%
Group median	—	16%	6.3%	9%	4%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Commercial Metals has delivered.

Today’s price $

Through the cycle, Commercial Metals earns about $444M on its 5.7% median owner-earnings margin. This year’s 5.5% margin runs in line with that. Normalize, below, values the price on that through-cycle figure rather than the latest year.

Base Normalize · through-cycle ($444M) Net of stock comp (−$47M) Steady-state · maintenance capex ($632M)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’21→’25+15%/yr

Owner-earnings growth · since FY2020−12%/yr

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Free cash flow $405M on 111M shares outstanding, per the 10-Q cover, as of 2026-06-25; net debt $2.9B. The base is the latest year by default; Normalize values it on the through-cycle median owner-earnings margin (to avoid paying on a peak year). Net of stock comp treats option pay as the expense it is. Capex ($513M) runs well above depreciation ($355M), so this is a build-out; Steady-state swaps total capex for maintenance (≈ depreciation), lifting the base to about $632M, the cash it would throw off if it stopped expanding. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh CMC against another business →

Cite: Owner Scorecard, "Commercial Metals (CMC), the owner's record," https://ownerscorecard.com/c/CMC, data as of 2026-07-09.

Manual order: ← CLX its page in the Manual CMCO →

Industry order: ← CLF the Steel chapter CRS →