ArcelorMittal
How A Decade Of Deleveraging Transformed A Global Steel Empire
Market Cap: $24,345,800,000
P/B: 0.47x
Net Debt: $5,100,000,000
EV: $29,445,800,000
Shares Outstanding: 768,550,000
Business Overview
Arcelor Mittal is the second largest producer of steel in the world, and the largest in the work ex-China producing 70M crude tons of steel for the full year 2024. The business has a vast footprint with 130K employees across four continents with integrated mini mill capacity and raw material capabilities providing a sustainable cost advantage on a cash cost per ton basis. Arcelor Mittal competes in what I consider to be the best markets for steel demand growth in the world with 60% of EBITDA coming from North America, Brazil, and India. For a laundry list of reasons, we believe the markets ArcelorMittal serves are advantaged for the next decade and despite weakness in steel related equities since the Global Financial Crisis, this business is poised to generate outsized returns through the next decade. Originally known for buying underperforming steel assets globally, cutting costs by reducing headcount and adding efficiencies, Mittal Steel has transformed itself through a few key acquisitions (most importantly Arcelor itself) to become one of the best steel producers in the world today with competitive advantages and the ability to grow its earnings further with growth capex projects that we think could double the businesses steady state earnings in the coming 3-5 year period.
