In 2010 ArcelorMittal approved a proposal to spin-off ArcelorMittal’s stainless and speciality steels businesses to its shareholders in order to enable it to benefit from better visibility in the markets. The Mittal family owns around 40% of the shares.
Share Buybacks: The share count has decreased from 84 million in 2019 to 72 million in 2023.
SECTOR: [PASS] Aperam is neither a technology nor a financial Company, and therefore this methodology is applicable.
SALES: [PASS] The investor must select companies of "adequate size". This includes companies with annual sales greater than €260 million. Aperam's sales of €8 156 million, based on 2022 sales, pass this test.
CURRENT RATIO: [PASS] The current ratio must be greater than or equal to 2. Companies that meet this criterion are typically financially secure and defensive. Aperam's current ratio €3 670m/€1 859m of 2.0 passes the test.
LONG-TERM DEBT IN RELATION TO NET CURRENT ASSETS: [PASS] For industrial companies, long-term debt must not exceed net current assets (current assets minus current liabilities). Companies that do not meet this criterion lack the financial stability that this methodology likes to see. The long-term debt for Aperam is €1 006 million, while the net current assets are €1 811 million. Aperam passes this test.
LONG-TERM EPS GROWTH: [PASS] Companies must increase their EPS by at least 30% over a ten-year period and EPS must not have been negative for any year within the last 5 years. EPS have increased 800% over the past ten years.
SECTOR: [PASS] Aperam is neither a technology nor a financial Company, and therefore this methodology is applicable.
SALES: [PASS] The investor must select companies of "adequate size". This includes companies with annual sales greater than €260 million. Aperam's sales of €8 156 million, based on 2022 sales, pass this test.
CURRENT RATIO: [PASS] The current ratio must be greater than or equal to 2. Companies that meet this criterion are typically financially secure and defensive. Aperam's current ratio €3 670m/€1 859m of 2.0 passes the test.
LONG-TERM DEBT IN RELATION TO NET CURRENT ASSETS: [PASS] For industrial companies, long-term debt must not exceed net current assets (current assets minus current liabilities). Companies that do not meet this criterion lack the financial stability that this methodology likes to see. The long-term debt for Aperam is €1 006 million, while the net current assets are €1 811 million. Aperam passes this test.
LONG-TERM EPS GROWTH: [PASS] Companies must increase their EPS by at least 30% over a ten-year period and EPS must not have been negative for any year within the last 5 years. EPS have increased 800% over the past ten years.
Earnings Yield: [PASS] The Earnings/Price (inverse P/E) %, based on the lesser of the current Earnings Yield or the Yield using average earnings over the last 3 fiscal years, must be "acceptable", which this methodology states is greater than 6,5%. Stocks with higher earnings yields are more defensive by nature. APERAM's E/P of 26% (using an average of the past 3 year's earnings) passes this test.
Graham Number value: [PASS] The Price/Book ratio must also be reasonable. That is the Graham number value must be greater than the market price. Aperam has a Graham number of √(15 x €8 EPS x €43 Book Value) = €91
Dividend: €1,75/€29 = 6%
Conclusion 2020: Over the years it seems to be creating value. Fairly priced (at EUR 49).
Conclusion 2023: At EUR 29 today it seems like a share for the Graham Defensive Investor
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