So ChatGPT just recommended a steel company. Not Tesla, not some flashy AI startup, but Commercial Metals Company (CMC) – literally the company that makes the rebar in your local bridge. I know, I know, your portfolio is probably crying for some excitement, but hear me out.
While everyone’s been chasing the next big AI thing, this chatbot just went full contrarian and said “Hey, what about the stuff that actually holds buildings up?” And honestly? It might be onto something.
The Most Unsexy Stock Pick Ever
CMC has been around since 1915 – that’s older than sliced bread (literally, sliced bread was invented in 1928). They make steel, recycle metal, and basically keep America from falling down. Not exactly the kind of company that gets TikTok investors excited, but here’s the kicker: the stock is up 26% this year.
While your favorite meme stocks have been doing their usual rollercoaster impression, this boring old steel company has been quietly printing money. Over the past 5 years, it’s averaged 25% annual returns. That’s better than most of the “revolutionary” companies everyone’s obsessing over.
The Numbers Don’t Lie (Even If They’re Confusing)
Here’s where it gets weird: CMC has a P/E ratio of 86, which sounds absolutely insane. Like, “this company better cure cancer” levels of expensive. But plot twist – the forward P/E is only 10. Translation: Wall Street thinks this company is about to make a lot more money.
Bank of America and Morgan Stanley are both saying “buy,” with target prices around $67-68 (it’s trading at about $64 now). That’s not exactly moon-shot territory, but it’s solid, boring growth – the kind your future self will thank you for.
Why Steel Might Actually Be Sexy
Think about it: America’s infrastructure is basically held together with duct tape and hope right now. Bridges are crumbling, roads need fixing, and someone’s got to supply the steel for all that construction. Plus, with all the talk about bringing manufacturing back to America, domestic steel producers like CMC are sitting pretty.
And here’s the Trump card (pun intended): while the administration slapped 50% tariffs on imported steel, CMC makes most of their stuff right here in the good ol’ USA. So while foreign competitors are getting hammered, CMC is just… making steel and counting money.
The Bottom Line
Look, I get it. Steel isn’t sexy. It doesn’t have an app, it won’t disrupt anything, and it definitely won’t make you feel like a tech visionary at dinner parties. But sometimes the best investments are the ones that make you yawn.
While everyone else is fighting over the latest AI darling, maybe – just maybe – the smart money is on the companies that literally build the foundation for everything else. ChatGPT might have just schooled us all on what real value investing looks like.
Disclaimer: This isn’t investment advice, just one person’s take on why boring might be beautiful. Do your own research before throwing money at steel companies or anything else.