Constellium SE’s CSTM cost structure remains under pressure from higher input and operating expenses. Constellium continued to face inflationary pressures in the second quarter of 2026. The company’s cost of sales, excluding depreciation and amortization, increased 23.3% year over year to $2.27 billion, while selling and administrative expenses rose 14.8% to $101 million. Higher activity levels also increased operating costs in the Aerospace & Transportation segment.
In the second quarter, holdings and corporate expenses rose to $16 million from $12 million a year earlier due to higher labor costs and unfavorable foreign exchange translation. Management also cited inflation in labor, energy, maintenance and supplies, along with higher freight, lubricant and coating costs. Although favorable scrap spreads and metal costs supported profitability in the second quarter, these benefits are expected to moderate in the second half of 2026.
Despite higher costs, Constellium delivered a noteworthy improvement in second-quarter profitability. Its gross margin expanded to 17.4% from 12.5% reported in the prior-year quarter. The margin expansion was driven by robust revenue growth, favorable metal prices and healthy demand across key end markets. CSTM’s revenues increased 31% year over year despite a modest decline in shipment volumes.
Constellium remains focused on improving operational efficiency, maintaining cost discipline and increasing its mix of value-added products, which should support margin expansion over time. Favorable market conditions and sustained demand for packaging rolled products are also expected to support the company’s performance. Despite continued inflationary pressures, healthy demand across the end markets, along with disciplined cost management, should help CSTM sustain margin strength in the quarters ahead.
Among its peers, Ryerson Holding Corp. RYZ remains affected by elevated costs. Ryerson’s warehousing, delivery, selling, general and administrative expenses increased 58.7% year over year to $320.3 million in the second quarter. The increase mainly reflected the addition of Olympic Steel’s operating expenses and higher costs associated with the expanded revenue and shipment base. Ryerson’s second-quarter gross margin fell to 17.7% from 18.4% in the prior quarter due to the purchase accounting adjustment related to the Olympic Steel merger.
Alcoa Corporation AA has also been witnessing the impacts of escalating costs. In the second quarter of 2026, Alcoa’s cost of sales increased 11.9% year over year. However, the metric, as a percentage of net sales, decreased significantly. Alcoa’s selling, general and administrative expenses also rose 23.2% in the quarter.
CSTM’s Price Performance, Valuation & Estimates
CSTM’s shares have popped 63.7% over a year, outperforming the Zacks Metal Products – Distribution industry’s increase of 20.7%.
From a valuation standpoint, CSTM is trading at a forward price-to-earnings ratio of 8.21X, above the industry’s average of 7.62X. Constellium carries a Value Score of A.
The Zacks Consensus Estimate for CSTM’s 2026 earnings implies a year-over-year rise of 97.4%. The EPS estimates for 2026 have been trending higher over the past 60 days.
CSTM stock currently carries a Zacks Rank #2 (Buy).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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