Critical Review: Ero Copper (NYSE:ERO) vs. Commercial Metals (NYSE:CMC)

Commercial Metals (NYSE:CMC) and Ero Copper (NYSE:ERO) are both mid-cap materials companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, earnings, valuation, analyst recommendations, risk, dividends and profitability.

Volatility & Risk

Commercial Metals has a beta of 1.55, indicating that its stock price is 55% more volatile than the S&P 500. Comparatively, Ero Copper has a beta of 1.32, indicating that its stock price is 32% more volatile than the S&P 500.

Profitability

This table compares Commercial Metals and Ero Copper’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Commercial Metals	6.98%	17.00%	7.85%
Ero Copper	32.21%	38.98%	19.98%

Insider and Institutional Ownership

86.9% of Commercial Metals shares are held by institutional investors. Comparatively, 71.3% of Ero Copper shares are held by institutional investors. 0.6% of Commercial Metals shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Commercial Metals and Ero Copper”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Commercial Metals	$9.39 billion	0.76	$655.85 million	$5.87	11.03
Ero Copper	$1.22 billion	2.65	$263.72 million	$3.73	8.28

Commercial Metals has higher revenue and earnings than Ero Copper. Ero Copper is trading at a lower price-to-earnings ratio than Commercial Metals, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings for Commercial Metals and Ero Copper, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Commercial Metals	1	4	10	0	2.60
Ero Copper	1	7	6	1	2.47

Commercial Metals presently has a consensus price target of $78.73, indicating a potential upside of 21.54%. Ero Copper has a consensus price target of $32.33, indicating a potential upside of 4.64%. Given Commercial Metals’ stronger consensus rating and higher probable upside, equities research analysts clearly believe Commercial Metals is more favorable than Ero Copper.

Summary

Commercial Metals beats Ero Copper on 10 of the 15 factors compared between the two stocks.

About Commercial Metals

Commercial Metals Company (CMC) is a metals recycling, manufacturing and construction-services company. Its operations span the collection and processing of ferrous and nonferrous scrap, which can be used as raw material for steelmaking, and the production of steel and other metal products. CMC manufactures products including reinforcing bar, merchant bar, wire rod and other steel products used in construction and industrial applications. The company also provides construction-related products and services, including steel fabrication and engineered solutions for infrastructure projects.

About Ero Copper

Ero Copper Corp. is a Canadian mining company focused on copper production in Brazil. Its operations include the Caraíba complex in Bahia, which comprises underground and open-pit mines and processing facilities, and the Tucumã mine in Pará. The company produces copper concentrate and may recover gold and silver as byproducts. Ero Copper was established in 2016 to acquire and develop copper assets in Brazil, and Tucumã began commercial production in 2024. Headquartered in Vancouver, British Columbia, Ero Copper’s business is centered on operating and developing its Brazilian mining assets.