Constellium (CSTM) AI Stock Analysis

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Constellium

(NYSE:CSTM)

Rating:69Neutral

Price Target:

$14.00

▲(8.19%Upside)

Constellium's overall score reflects strong technical momentum and operational efficiency offset by financial stability risks due to high leverage and negative cash flow. The earnings call highlighted both achievements and challenges, adding a mixed sentiment. Valuation concerns due to a high P/E ratio further moderate the overall score.

Positive Factors

Earnings

CSTM beat expectations and reiterated guidance, which had a more positive impact given uncertainty around end-market exposure.

Financial Performance

CSTM reported segment adjusted EBITDA of $140M ahead of the Street’s $120M.

Share Repurchase

Improved profitability is expected to result in free cash flow in excess of $120m, allowing Constellium some ability to accelerate share repurchases.

Negative Factors

Aerospace Shipments

Aerospace shipments specifically declined by 11% as commercial OEMs continued to address excess inventory caused by ongoing supply chain challenges.

Market Conditions

Constellium has been going through a rough patch driven by end market weakness, which is viewed as cyclical.

Constellium (CSTM) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$1.83B

Dividend YieldN/A

Average Volume (3M)1.82M

Price to Earnings (P/E)28.6

Beta (1Y)1.20

Revenue Growth-2.29%

EPS Growth-48.13%

CountryUS

Employees12,000

SectorBasic Materials

Sector Strength67

IndustryAluminum

Share Statistics

EPS (TTM)0.26

Shares Outstanding142,918,000

10 Day Avg. Volume1,595,999

30 Day Avg. Volume1,818,268

Financial Highlights & Ratios

PEG Ratio0.15

Price to Book (P/B)1.86

Price to Sales (P/S)0.00

P/FCF Ratio-13.29

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$15.00

Price Target Upside15.92% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering3

Constellium Business Overview & Revenue Model

Company DescriptionConstellium SE, together with its subsidiaries, engages in the design, manufacture, and sale of specialty rolled and extruded aluminum products for the packaging, aerospace, and automotive end-markets. The company operates through three segments: Packaging & Automotive Rolled Products, Aerospace & Transportation, and Automotive Structures & Industry. The Packaging & Automotive Rolled Products segment produces rolled aluminum products, including can stock and closure stock for the beverage and food industry, as well as foil stock for the flexible packaging market. It also supplies automotive body sheets and heat exchangers for the automotive market; and specialty reflective sheets. The Aerospace & Transportation segment provides rolled aluminum products, including aerospace plates, sheets, and extrusions; and aerospace wing skins, as well as plates and sheets for use in transportation, industry, and defense applications. The Automotive Structures & Industry segment offers extruded products and technologically advanced structures for the automotive industry, including crash-management systems, body structures, side impact beams, and battery enclosures; and hard and soft alloy extruded profiles for various industry applications in the automotive, engineering, rail, and other transportation end markets. This segment also provides downstream technology and services, which include pre-machining, surface treatment, research and development, and technical support services. The company sells its products directly or through distributors in France, Germany, the Czech Republic, the United Kingdom, Switzerland, and the United States, as well as Shanghai, and Seoul. Constellium SE was incorporated in 2010 and is headquartered in Paris, France.

How the Company Makes MoneyConstellium generates revenue through the sale of its aluminum products, which are primarily targeted towards the aerospace, automotive, and packaging industries. The company operates in three main segments: Aerospace & Transportation, Packaging & Automotive Rolled Products, and Automotive Structures & Industry, each contributing to its overall earnings. Revenue is driven by long-term contracts with key clients, including automotive manufacturers and aerospace companies, who require high-performance and lightweight materials. Constellium also leverages its technological advancements to create value-added products, which command higher margins. Strategic partnerships and collaborations with industry leaders to develop new materials and solutions further bolster its revenue streams. Additionally, the company's focus on sustainability and recycling initiatives provides an edge in attracting environmentally conscious clients, thus enhancing its market position and profitability.

Constellium Earnings Call Summary

Earnings Call Date:Apr 30, 2025

(Q1-2025)

% Change Since: 34.93%|

Next Earnings Date:Jul 23, 2025

Earnings Call Sentiment Neutral

The earnings call presented a mixed outlook. While there were significant achievements, such as growth in revenue and net income, and strong safety performance, there were also notable challenges, including declines in shipments, negative free cash flow, and the impact of tariffs on costs. The sentiment is balanced with a slight inclination towards the challenges faced by the company.

Q1-2025 Updates

Positive Updates

Strong Safety Performance

Achieved a recordable case rate of 1.02 per million hours worked, surpassing safety targets.

Revenue Increase

Revenue of $2 billion, a 5% increase compared to the first quarter of 2024, driven by higher metal prices.

Net Income Growth

Net income of $38 million in the quarter, up from $22 million in the first quarter last year.

Packaging Segment Performance

Packaging shipments increased by 9% in the quarter, with demand remaining healthy in North America and Europe.

Solid EBITDA Performance

Adjusted EBITDA was $140 million, excluding the positive non-cash impact from metal price lag.

Negative Updates

Decline in Shipments

Shipments were 372,000 tons, down 2% compared to the first quarter of 2024.

Negative Free Cash Flow

Free cash flow was negative $3 million in the first quarter.

Aerospace and TID Segment Weakness

Adjusted EBITDA for A&T segment decreased by 14% due to lower shipments in aerospace and TID markets.

Automotive Segment Challenges

Automotive shipments decreased by 15% in the quarter, with continued weakness in North America and Europe.

Impact of Tariffs

Section 232 tariffs on Canadian extrusions resulted in a $1 million impact in Q1, with an expected $20 million impact for the rest of the year.

Company Guidance

During the Constellium First Quarter 2025 Results Call, the company provided guidance on several key financial metrics. They reported a revenue increase of 5% to $2 billion compared to Q1 2024, primarily due to higher metal prices, even though shipments decreased by 2% to 372,000 tons. Net income rose to $38 million from $22 million the previous year. Adjusted EBITDA was $186 million, including a $46 million non-cash impact from metal price lag, with an economic performance of $140 million after exclusion. They faced a $4 million foreign exchange headwind and a $10 million negative impact from last year's flood at Valais. Constellium maintained its 2025 guidance for adjusted EBITDA, excluding metal price lag, between $600 million to $630 million, and projected free cash flow of over $120 million, despite a challenging environment. The company also highlighted a 1.02 recordable case rate per million hours worked and a share repurchase of $15 million, with an anticipated leverage decrease from 3.3 times by year-end.

Constellium Financial Statement Overview

Summary

Constellium demonstrates strengths in operational efficiency and cost management, as reflected in its gross profit and EBIT margins. However, the company faces challenges with high leverage and negative free cash flow, which may affect its financial stability. While there are signs of recovery in revenue and profitability, the balance sheet and cash flow statements indicate areas that require attention to ensure long-term sustainability.

Income Statement

Positive

Constellium's revenue shows a mixed trend with a slight decline in recent years, but the TTM (Trailing-Twelve-Months) data presents an improvement, indicating potential recovery. The gross profit margin is strong at 37.2% for TTM, suggesting efficient cost management. However, the net profit margin is modest at 1.7% for the same period, reflecting challenges in achieving higher profitability. The EBIT and EBITDA margins are robust, with TTM figures at 32.5% and 5.3%, respectively, indicating operational efficiency.

Balance Sheet

Positive

The company's balance sheet highlights a high debt-to-equity ratio of approximately 2.54 for TTM, indicating significant leverage, which could pose financial risks. Return on equity is moderate at 16.2% for TTM, reflecting reasonable profitability for shareholders. The equity ratio stands at 14.8% for the same period, suggesting limited equity financing and potential vulnerability during financial downturns.

Cash Flow

Neutral

Constellium's cash flow analysis reveals challenges, particularly with negative free cash flow in recent periods, including TTM at -$105 million. The operating cash flow to net income ratio is 2.38 for TTM, suggesting adequate cash conversion from earnings. However, the free cash flow to net income ratio is negative, indicating issues in sustaining capital expenditures and operational cash requirements.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
7.33B	7.08B	7.24B	8.12B	6.15B	4.88B
	Gross Profit
1.01B	905.45M	710.00M	672.00M	664.00M	490.00M
	EBIT
595.01M	556.01M	337.00M	334.00M	484.00M	125.00M
	EBITDA
385.91M	530.91M	605.00M	601.00M	764.00M	454.00M
	Net Income Common Stockholders
75.06M	54.06M	125.00M	301.00M	257.00M	-17.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
118.00M	141.00M	210.00M	197.00M	205.00M	478.00M
	Total Assets
5.17B	4.73B	4.66B	4.94B	4.62B	4.13B
	Total Debt
2.06B	1.94B	1.87B	2.06B	2.13B	2.39B
	Net Debt
1.94B	1.79B	1.69B	1.89B	1.98B	1.95B
	Total Liabilities
4.40B	4.01B	3.80B	4.19B	4.33B	4.23B
	Stockholders Equity
765.00M	681.50M	843.00M	731.00M	274.00M	-115.00M
Cash Flow		Free Cash Flow
-105.08M	-108.11M	169.00M	178.00M	125.00M	152.00M
	Operating Cash Flow
294.74M	290.56M	506.00M	451.00M	357.00M	334.00M
	Investing Cash Flow
-299.28M	-302.14M	-288.00M	-270.00M	-221.00M	-176.00M
	Financing Cash Flow
-70.95M	-58.88M	-182.00M	-163.00M	-435.00M	101.00M

Constellium Technical Analysis

Technical Analysis Sentiment

Positive

Last Price12.94

Price Trends

50DMA

10.55

Positive

100DMA

10.61

Positive

200DMA

11.98

Positive

Market Momentum

MACD

0.58

Negative

RSI

67.41

Neutral

STOCH

91.42

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CSTM, the sentiment is Positive. The current price of 12.94 is above the 20-day moving average (MA) of 12.24, above the 50-day MA of 10.55, and above the 200-day MA of 11.98, indicating a bullish trend. The MACD of 0.58 indicates Negative momentum. The RSI at 67.41 is Neutral, neither overbought nor oversold. The STOCH value of 91.42 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CSTM.

Constellium Risk Analysis

Constellium disclosed 31 risk factors in its most recent earnings report. Constellium reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Constellium Peers Comparison

Overall Rating

UnderperformOutperform

Sector (51)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AA	72 Outperform	$7.22B	8.25	17.53%	1.44%	21.56%	―
CENX	70 Outperform	$1.84B	17.22	18.03%	―	11.42%	-49.21%
CSTM	69 Neutral	$1.83B	28.63	7.93%	―	-2.29%	-48.13%
KALU	67 Neutral	$1.25B	29.01	6.16%	3.94%	1.56%	-22.11%
NGVT	54 Neutral	$1.50B	―	-88.14%	―	-17.68%	-214.32%
RDUS	53 Neutral	$834.21M	―	-41.03%	2.53%	-2.75%	-339.59%
Sector *	51 Neutral	$2.03B	-1.13	-21.36%	3.65%	2.87%	-30.54%

* Basic Materials Sector Average

Performance Comparison

CSTM

Constellium

12.94

-7.26

-35.94%

Alcoa

28.01

-12.65

-31.11%

CENX

Century Aluminum

19.53

3.74

23.69%

KALU

Kaiser Aluminum

78.16

-10.06

-11.40%

RDUS

Schnitzer Steel Industries

29.62

14.05

90.24%

NGVT

Ingevity

42.05

-4.39

-9.45%

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.