ArcelorMittal Expands Mining, Logistics Operations in Liberia

Multinational steel manufacturing firm ArcelorMittal (MT) has signed an amendment to the Mineral Development Agreement (MDA) with the government of Liberia to expand its mining and logistics operations in the country. Headquartered in Luxembourg, the company caters to the machinery, appliance, energy, construction, engineering and automotive industries.

Following the amendment, ArcelorMittal Liberia will increase the production of premium iron ore, thereby generating wider economic benefits and significant new jobs in the nation. The expansion project, which is likely to need $800 million, will include processing, port and rail facilities. (See ArcelorMittal stock chart on TipRanks)

Furthermore, the project will involve the construction of a new concentration plant that will result in the expansion of mining operations. The first concentrate is expected in late 2023, which can be raised up to 15 million tonnes per annum (mtpa). As per the terms of the agreement, ArcelorMittal will have reservation for expansion for up to 30mt.

The CEO of ArcelorMittal, Aditya Mittal, said, “Signing the MDA amendment will enable us to capitalize on and add to the infrastructure investments previously undertaken and transform ArcelorMittal Liberia into a large-scale, premium product operation.”

Two months ago, KeyBanc analyst Philip Gibbs maintained a Buy rating on the stock with a price target of $40 (22.5% upside potential). The analyst expects the company to report earnings of $1.94 per share in the third quarter.

Overall, the stock has a Strong Buy consensus rating based on 5 unanimous Buys. The average ArcelorMittal price target of $45.21 implies 38.5% upside potential. Shares of the company have gained 155.3% over the past year.

According to TipRanks’ Smart Score rating system, ArcelorMittal scores a “Perfect 10,” suggesting that the stock is likely to outperform market averages.