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Cemex Sab De Cv (CX)
:CX

Cemex SAB (CX) AI Stock Analysis

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CX

Cemex SAB

(NYSE:CX)

Rating:72Outperform
Price Target:
$7.50
▲(4.60%Upside)
Cemex SAB's stock score is driven by strong technical indicators and attractive valuation, tempered by financial performance challenges and mixed earnings call sentiment. The company's strategic initiatives and cost management efforts suggest potential for future growth.
Positive Factors
Cost Management
CX is targeting $350 million in savings over three years as part of cost reduction efforts.
Leadership and Strategy
The new CEO, Jaime Muguiro, has outlined priorities such as additional deleveraging, strategic acquisitions, and improving profitability.
Valuation
Cemex is trading at a 20% discount to its 5-year average, indicating an attractive valuation.
Negative Factors
Geopolitical and Economic Issues
Potential negatives include softer US cement volumes, high interest rates, potential tariffs, and geopolitical risks.
Market Challenges
CX posted weak figures on challenging quarter with revenues coming 3% below expectations and cement volumes down in key markets.
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)

Cemex SAB Business Overview & Revenue Model

Company DescriptionCemex SAB de CV (CX) is a leading global building materials company headquartered in Monterrey, Mexico. It operates in the construction materials sector, specializing in the production, distribution, and sale of cement, ready-mix concrete, aggregates, and other related building materials. With a comprehensive network of operations spanning more than 50 countries, Cemex is committed to being the partner of choice for construction needs, contributing to the development of infrastructure and housing projects worldwide.
How the Company Makes MoneyCemex makes money primarily through the production and sale of cement, ready-mix concrete, and aggregates. These core products are essential components in construction and infrastructure development, which are in consistent demand across both developed and emerging markets. Cemex's revenue model includes direct sales to construction companies, government entities, and individual consumers. The company benefits from its vertically integrated operations which allow it to control the supply chain from raw material extraction to final product delivery, enhancing operational efficiency and cost-effectiveness. Additionally, Cemex engages in strategic partnerships and innovations to enhance its product offerings, improve sustainability, and expand market reach. The company's significant presence in diverse geographic markets also helps mitigate risks associated with local economic fluctuations, contributing to steady revenue streams.

Cemex SAB Earnings Call Summary

Earnings Call Date:Apr 28, 2025
(Q1-2025)
|
% Change Since: 21.53%|
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.

Cemex SAB Financial Statement Overview

Summary
Cemex SAB's financial performance shows stability with a reasonable equity ratio and moderate leverage. Challenges include declining revenue and net income, inconsistent free cash flow growth, and moderate operational efficiency, indicating areas for strategic improvement.
Income Statement
65
Positive
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.
Balance Sheet
70
Positive
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.
Cash Flow
60
Neutral
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.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue16.04B16.20B17.39B15.58B14.55B12.97B
Gross Profit5.19B5.44B5.86B4.82B4.67B4.18B
EBITDA1.85B2.67B3.26B2.42B2.68B595.00M
Net Income1.42B939.00M182.00M858.00M753.00M-1.47B
Balance Sheet
Total Assets27.97B27.30B28.43B27.49B27.70B28.07B
Cash, Cash Equivalents and Short-Term Investments1.18B864.00M624.00M495.00M613.00M950.00M
Total Debt0.007.36B8.16B8.82B9.16B11.19B
Total Liabilities14.61B14.82B16.32B16.58B17.43B19.12B
Stockholders Equity13.07B12.18B11.05B10.50B9.83B8.07B
Cash Flow
Free Cash Flow776.12M894.00M984.00M415.00M862.00M987.00M
Operating Cash Flow1.81B1.89B2.16B1.48B1.85B1.58B
Investing Cash Flow433.81M-328.00M-1.34B-732.00M-285.00M88.00M
Financing Cash Flow-1.52B-1.25B-701.00M-961.00M-1.85B-1.50B

Cemex SAB Technical Analysis

Technical Analysis Sentiment
Positive
Last Price7.17
Price Trends
50DMA
6.65
Positive
100DMA
6.30
Positive
200DMA
6.01
Positive
Market Momentum
MACD
0.09
Negative
RSI
64.20
Neutral
STOCH
88.54
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 7.17 is above the 20-day moving average (MA) of 6.86, above the 50-day MA of 6.65, and above the 200-day MA of 6.01, indicating a bullish trend. The MACD of 0.09 indicates Negative momentum. The RSI at 64.20 is Neutral, neither overbought nor oversold. The STOCH value of 88.54 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 (44)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
EXEXP
76
Outperform
$6.97B15.5233.52%0.47%0.05%0.96%
75
Outperform
$549.82M9.7415.93%8.15%2.50%15.20%
CXCX
72
Outperform
$10.95B7.436.58%1.25%-8.41%570.14%
JHJHX
72
Outperform
$12.12B27.5221.05%-1.59%-15.58%
MLMLM
70
Outperform
$33.68B32.1211.88%0.56%-0.54%-48.61%
70
Outperform
$1.35B13.2614.05%-37.30%32.91%
44
Neutral
C$976.20M-6.71-13.35%2.69%17.20%-32.62%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
CX
Cemex SAB
7.23
1.13
18.52%
CPAC
Cementos Pacasmayo SAA
6.15
0.89
16.92%
EXP
Eagle Materials
214.18
0.29
0.14%
JHX
James Hardie
26.89
-5.33
-16.54%
MLM
Martin Marietta Materials
557.89
24.30
4.55%
LOMA
Loma Negra Compania Industrial Argentina Sociedad Anonima
11.31
4.56
67.56%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Jun 05, 2025