11:40 AM EST, 12/19/2024 (MT Newswires) -- Commercial Metals ( CMC ) is well placed to benefit from incremental rebar demand linked to US government-funded projects, Morgan Stanley said in a note on Thursday.

But, stock valuation is high, compared with historic performance, and new rebar supply will potentially compress margins along with a possible glut in the supply chain with increased rebar capacity in the US, the brokerage said.

Meanwhile, the company's "increasing exposure to construction solutions [and] improving European operations support higher EBITDA 2025-26 regardless of steel prices," the note said.

The investment firm started coverage of the company with an equal-weight rating and $65 price target.

Price: 50.37, Change: -0.87, Percent Change: -1.70