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Cemex SAB (CX)
NYSE:CX
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Cemex SAB
(NYSE:CX)
Rating:73Outperform
Price Target:―
Positive Factors
Attractive Valuation
Cemex is trading at a 20% discount to its 5-year average, indicating an attractive valuation.
Growth Opportunities
CX's long-term growth outlook is supported by factors such as a US manufacturing revival and the US Infrastructure Bill.
New Leadership
The new CEO, Jaime Muguiro, has outlined priorities such as additional deleveraging, strategic acquisitions, and improving profitability.
Negative Factors
Decline in Cement Volumes
Consolidated cement volumes were down 2% year over year, with significant declines in Mexico and the US.
Market Challenges
CX is facing potential challenges, including higher interest rates, US housing market issues, and fiscal challenges in Mexico.
Weather Impact
Bad weather caused slower activity and inventory buildup effects in the US, with places experiencing record snowfall.
Cemex SAB (CX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$10.66B
Dividend Yield1.18%
Average Volume (3M)15.51M
Price to Earnings (P/E)7.3
Beta (1Y)1.32
Revenue Growth-8.41%
EPS Growth570.14%
CountryUS
Employees43,800
SectorBasic Materials
Sector Strength63
IndustryConstruction Materials
Share Statistics
EPS (TTM)0.50
Shares Outstanding1,449,087,000
10 Day Avg. Volume14,619,430
30 Day Avg. Volume15,514,762
Financial Highlights & Ratios
PEG Ratio0.74
Price to Book (P/B)0.71
Price to Sales (P/S)0.00
P/FCF Ratio11.98
Enterprise Value/Market Cap0.76
Enterprise Value/Revenue0.12
Enterprise Value/Gross Profit1.56
Enterprise Value/Ebitda1.04
Forecast
1Y Price Target
$7.49Price Target Upside5.05% Upside
Rating ConsensusHold
Number of Analyst Covering8
Cemex SAB Business Overview & Revenue Model
Company DescriptionCEMEX, S.A.B. de C.V., together with its subsidiaries, produces, markets, distributes, and sells cement, ready-mix concrete, aggregates, urbanization solutions, and other construction materials worldwide. The company also offers various complementary construction products, including asphalt products; concrete blocks; roof tiles; architectural products; concrete pipes for storm and sanitary sewers applications; and other precast products, such as rail products, concrete floors, box culverts, bridges, drainage basins, barriers, and parking curbs. In addition, it provides building solutions for housing solutions, pavement solutions, and green building services; cement trade maritime services; and information technology solutions. The company operates approximately 2,000 retail stores. CEMEX, S.A.B. de C.V. was founded in 1906 and is headquartered in San Pedro Garza García, Mexico.
How the Company Makes MoneyCemex makes money by manufacturing and distributing cement, ready-mix concrete, and aggregates, which are essential materials for construction projects worldwide. The company generates revenue through the sale of these products to a diverse customer base, including construction companies, developers, and government entities. Cemex's revenue model is supported by its extensive global network of production facilities and sales operations, allowing it to efficiently supply its products to various markets. Additionally, the company leverages strategic partnerships and joint ventures to enhance its market presence and access new opportunities. Factors such as infrastructure development, urbanization, and economic growth in the regions where Cemex operates significantly contribute to its earnings.
Cemex SAB Financial Statement Overview
Summary
Cemex SAB exhibits a stable financial foundation with some areas of concern. Revenue and profit growth challenges highlight the need for strategic focus on market expansion and cost efficiency. The balance sheet reflects prudent financial management, although leverage requires ongoing attention. Cash flow metrics show resilience but underscore the importance of enhancing free cash flow growth to support future investments and reduce financial risks.Income Statement
Cemex SAB has shown a mixed performance in its income statement. The gross profit margin has been relatively stable, implying cost management is effective. However, there has been a decline in both total revenue and net income in the most recent year, resulting in weaker revenue growth. The net profit margin has improved significantly from a low base, but the overall profitability remains a concern. The EBIT and EBITDA margins show a moderate position, indicating operational efficiency challenges.65
Positive
Balance Sheet
The balance sheet of Cemex SAB reflects a fairly stable financial position with a reasonable equity ratio, suggesting a solid asset base supported by equity. The debt-to-equity ratio indicates moderate leverage, which is typical for the construction materials industry but necessitates careful management to avoid potential risks. Return on equity has seen improvement, showcasing the company's ability to generate profits from shareholders' investments.70
Positive
Cash Flow
Cash flow analysis reveals challenges in sustaining free cash flow growth. Although operating cash flow remains robust in relation to net income, the free cash flow growth has been inconsistent, which could impact future investments and strategic initiatives. The company's ability to convert operating profits into cash flow is efficient, but maintaining a positive trajectory in free cash flow is crucial for long-term growth.60
Neutral
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 16.04B | 16.20B | 17.39B | 15.58B | 14.55B | 12.97B | Gross Profit |
| 5.19B | 5.44B | 5.86B | 4.82B | 4.67B | 4.18B | EBIT |
| 1.70B | 1.82B | 1.85B | 1.09B | 1.62B | -436.00M | EBITDA |
| 1.85B | 2.67B | 3.26B | 2.42B | 2.68B | 595.00M | Net Income Common Stockholders |
| 1.42B | 939.00M | 182.00M | 858.00M | 753.00M | -1.47B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 1.18B | 864.00M | 624.00M | 495.00M | 613.00M | 950.00M | Total Assets |
| 27.97B | 27.30B | 28.43B | 27.49B | 27.70B | 28.07B | Total Debt |
| 0.00 | 7.36B | 8.16B | 8.82B | 9.16B | 11.19B | Net Debt |
| -1.18B | 6.49B | 7.54B | 8.33B | 8.54B | 10.23B | Total Liabilities |
| 14.61B | 14.82B | 16.32B | 16.58B | 17.43B | 19.12B | Stockholders Equity |
| 13.07B | 12.18B | 11.05B | 10.50B | 9.83B | 8.07B |
| Cash Flow | Free Cash Flow | ||||
| 776.12M | 894.00M | 984.00M | 415.00M | 862.00M | 987.00M | Operating Cash Flow |
| 1.81B | 1.89B | 2.16B | 1.48B | 1.85B | 1.58B | Investing Cash Flow |
| 433.81M | -328.00M | -1.34B | -732.00M | -285.00M | 88.00M | Financing Cash Flow |
| -1.52B | -1.25B | -701.00M | -961.00M | -1.85B | -1.50B |
Cemex SAB Technical Analysis
Positive
7.13
Price Trends
5.98
Positive
6.00
Positive
5.92
Positive
Market Momentum
0.33
Negative
74.95
Negative
90.90
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CX, the sentiment is Positive. The current price of 7.13 is above the 20-day moving average (MA) of 6.50, above the 50-day MA of 5.98, and above the 200-day MA of 5.92, indicating a bullish trend. The MACD of 0.33 indicates Negative momentum. The RSI at 74.95 is Negative, neither overbought nor oversold. The STOCH value of 90.90 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CX.
Cemex SAB Risk Analysis
Cemex SAB disclosed 40 risk factors in its most recent earnings report. Cemex SAB 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 3 New Risks
1.
The failure of any bank in which we deposit our funds could have an adverse effect on our financial condition. Q4, 2022
2.
We are subject to restrictions and reputational risks resulting from non-controlling interests held by third parties in our consolidated subsidiaries. As of the date of this annual report, we control three publicly listed companies, where this risk is heightened. Q4, 2022
3.
We may fail to secure certain materials required to run our business, which could have a material adverse effect on our business, financial condition, liquidity and results of operations. Q4, 2022
Cemex SAB Peers Comparison
Overall Rating
UnderperformOutperform
Sector (50)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $6.99B | 15.51 | 33.52% | 0.47% | 0.64% | -1.15% | |
76 Outperform | $1.62B | 15.81 | 14.05% | ― | -37.30% | 32.91% | |
75 Outperform | $528.45M | 8.95 | 15.93% | 8.83% | 2.50% | 15.20% | |
75 Outperform | $34.04B | 32.47 | 11.88% | 0.56% | -0.54% | -48.61% | |
73 Outperform | $10.66B | 7.25 | 6.58% | 1.18% | -8.41% | 570.14% | |
68 Neutral | $10.19B | 24.00 | 21.05% | ― | 1.26% | -17.38% | |
50 Neutral | $1.98B | -1.07 | -21.34% | 3.71% | 2.03% | -30.65% |
* Basic Materials Sector Average
Performance Comparison
CX
Cemex SAB
7.13
-0.38
-5.06%
CPAC
Cementos Pacasmayo SAA
5.74
0.70
13.89%
EXP
Eagle Materials
214.37
-22.93
-9.66%
JHX
James Hardie
23.45
-7.79
-24.94%
MLM
Martin Marietta Materials
561.72
-14.13
-2.45%
LOMA
Loma Negra Compania Industrial Argentina Sociedad Anonima
13.78
6.85
98.85%
Cemex SAB Earnings Call Summary
Earnings Call Date:Apr 28, 2025
(Q1-2025)
| % Change Since: 20.44%|
Next Earnings Date:Jul 24, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted significant strategic initiatives under new leadership, with a focus on cost savings and operational efficiency. However, challenges such as volume declines due to weather and economic conditions, as well as currency impacts, were noted. While there are positive steps toward future growth, current operational challenges balance the overall sentiment.Q1-2025 Updates
Positive Updates
New CEO Appointment
Jaime Muguiro appointed as new CEO, with a focus on strategic priorities such as deleveraging, investing in the U.S., and enhancing shareholder return.
Project Cutting Edge
Introduction of a cost-savings program aimed at enhancing EBITDA margin, increasing free cash flow, and improving free cash flow conversion rate with expected recurring yearly EBITDA savings of at least $350 million by 2027.
Strong Pricing Strategy
Cement and ready-mix prices rose 2%, while aggregates prices increased by 4% sequentially, with a pricing strategy aimed at recovering cost inflation.
Record Net Income
Record net income of $734 million, primarily driven by the sale of operations in the Dominican Republic.
Improved Operational Efficiency
Operational efficiency in the U.S. improved by 5 percentage points year-over-year in the first quarter of 2025.
Urbanization Solutions Portfolio Growth
Urbanization Solutions portfolio posted EBITDA growth of 16% in South, Central America, and the Caribbean region with a margin expansion of more than 4 percentage points.
Negative Updates
Volume Declines in Key Markets
Cement volume variation in Mexico and the U.S. due to strong pre-election comparison base, typical seasonality, and adverse weather conditions.
Challenges in Mexican Operations
Peso depreciation resulted in a $65 million headwind, and a strong pre-election base led to a decline in cement volumes.
Impact of Adverse Weather
Unusually cold winter weather in the U.S. disrupted construction activity, impacting cement and ready-mix volume dynamics.
Residential Sector Weakness
Weakness observed in the U.S. residential sector, particularly impacting single-family homes due to high mortgage rates.
Company Guidance
In the CEMEX First Quarter 2025 Conference Call, several key metrics and strategic priorities were highlighted. New CEO Jaime Muguiro emphasized Project Cutting Edge, a cost-savings initiative projected to deliver recurring yearly EBITDA savings of at least $350 million by 2027, with $150 million expected in 2025. The program aims to enhance EBITDA margin, increase free cash flow, and improve the free cash flow conversion rate. The first quarter saw a 17% decline in unitary energy costs and a reduction in net CO2 emissions per ton of cement equivalent by 1.6% year-over-year. The company also reported record net income driven by divestment gains, while first quarter results aligned with expectations for flat EBITDA for the full year. Pricing strategies resulted in sequential price increases of 2% for cement and ready-mix, and 4% for aggregates. Additionally, CEMEX's circularity business achieved a 5% EBITDA growth on flat sales, with a remarkable 27% compounded annual growth rate over the past two years.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.