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Companhia Siderúrgica Nacional (SID)
NYSE:SID

Companhia Siderúrgica Nacional (SID) AI Stock Analysis

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SI

Companhia Siderúrgica Nacional

(NYSE:SID)

55Neutral
The overall score reflects the company's financial challenges, particularly with declining revenues and increased leverage, balanced by operational strengths and strategic cash management. Technical indicators suggest bearish sentiment, while valuation is mixed with a high dividend yield but negative P/E ratio. The positive outlook from the earnings call provides some optimism.

Companhia Siderúrgica Nacional (SID) vs. S&P 500 (SPY)

Companhia Siderúrgica Nacional Business Overview & Revenue Model

Company DescriptionCompanhia Siderúrgica Nacional (SID) is a prominent Brazilian steelmaker and one of the largest industrial conglomerates in Latin America. Established in 1941, the company is headquartered in São Paulo, Brazil. CSN operates across multiple sectors including steel production, mining, logistics, cement, and energy. Its core products and services include flat steel products, tinplate, and long steel products, which are primarily used in the automotive, construction, packaging, and home appliances industries.
How the Company Makes MoneyCSN primarily generates revenue through the production and sale of steel products. The company's revenue model is centered around its integrated steel mill, which allows it to produce a wide range of steel products efficiently. Key revenue streams include the sale of flat steel products, such as hot and cold-rolled coils and sheets, and tinplate, which is used for packaging applications. Additionally, CSN earns significant income from its mining operations, particularly iron ore extraction, which supplies raw material for its steel production and is also sold in international markets. The logistics sector contributes to earnings by providing transportation and port services, enhancing the efficiency of CSN's supply chain. Furthermore, CSN's ventures in cement production and energy generation diversify its revenue sources, leveraging by-products from its steel-making operations and utilizing its energy assets to support operational needs and sell excess capacity. Strategic partnerships and investments in technology and infrastructure also play a crucial role in optimizing production processes and expanding market reach, contributing to the company's financial performance.

Companhia Siderúrgica Nacional Financial Statement Overview

Summary
Companhia Siderúrgica Nacional is facing declining revenues and profitability issues in the TTM period, with operational efficiency and cash flow generation as relative strengths. However, increased leverage and decreased equity raise concerns about financial stability.
Income Statement
55
Neutral
The company has experienced declining revenues from 2021 to TTM (Trailing-Twelve-Months), indicating potential challenges in maintaining sales volumes or pricing power. The gross profit margin has decreased, reflecting tighter cost management or reduced pricing power. EBIT and EBITDA margins remain relatively stable, suggesting some operational efficiency. However, the negative net income in the TTM period is concerning, indicating profitability issues.
Balance Sheet
60
Neutral
The debt-to-equity ratio has increased, indicating higher financial leverage and potential risk if earnings do not improve. Stockholders' equity has declined from 2021, weakening the equity position. The company's equity ratio is stable but on the lower side, indicating a higher proportion of assets financed by debt. Return on equity has deteriorated significantly, presenting a challenge for shareholder value creation.
Cash Flow
65
Positive
Operating cash flow remains positive, indicating some ability to generate cash from operations. However, free cash flow has decreased from previous periods, limiting flexibility for investments or debt repayment. The ratio of operating cash flow to net income is not meaningful due to negative net income in the TTM period, but the company has managed to maintain some level of free cash flow despite earnings challenges.
Breakdown
TTMDec 2023Dec 2022Dec 2021Dec 2020Dec 2019
Income StatementTotal Revenue
43.67B45.44B44.36B47.91B30.06B25.44B
Gross Profit
11.42B11.30B13.31B22.07B10.94B8.17B
EBIT
5.18B5.19B7.40B18.50B7.53B4.22B
EBITDA
8.68B8.58B10.07B23.08B9.69B5.74B
Net Income Common Stockholders
-1.38B-318.21M2.17B12.26B3.79B1.79B
Balance SheetCash, Cash Equivalents and Short-Term Investments
3.14B17.59B13.45B19.30B13.73B3.73B
Total Assets
47.33B91.53B85.35B79.38B63.00B50.87B
Total Debt
28.83B45.59B41.61B33.12B35.80B28.44B
Net Debt
26.58B29.55B29.62B16.47B25.86B27.35B
Total Liabilities
37.31B71.84B63.54B56.00B51.75B39.51B
Stockholders Equity
8.70B17.50B19.49B20.31B9.91B10.17B
Cash FlowFree Cash Flow
1.76B2.88B-3.33B13.57B7.89B2.66B
Operating Cash Flow
6.76B7.29B2.04B16.43B9.58B4.87B
Investing Cash Flow
-5.20B-4.59B-11.45B447.93M-1.86B-2.24B
Financing Cash Flow
1.71B1.32B4.75B-8.53B1.19B-3.79B

Companhia Siderúrgica Nacional Technical Analysis

Technical Analysis Sentiment
Negative
Last Price1.46
Price Trends
50DMA
1.48
Negative
100DMA
1.67
Negative
200DMA
1.91
Negative
Market Momentum
MACD
-0.02
Positive
RSI
45.33
Neutral
STOCH
67.62
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SID, the sentiment is Negative. The current price of 1.46 is below the 20-day moving average (MA) of 1.50, below the 50-day MA of 1.48, and below the 200-day MA of 1.91, indicating a bearish trend. The MACD of -0.02 indicates Positive momentum. The RSI at 45.33 is Neutral, neither overbought nor oversold. The STOCH value of 67.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SID.

Companhia Siderúrgica Nacional Risk Analysis

Companhia Siderúrgica Nacional disclosed 41 risk factors in its most recent earnings report. Companhia Siderúrgica Nacional reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Companhia Siderúrgica Nacional Peers Comparison

Overall Rating
UnderperformOutperform
Sector (47)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
MTMT
73
Outperform
$25.73B18.522.60%1.32%-8.56%68.36%
NUNUE
72
Outperform
$29.95B14.979.79%1.71%-11.46%-53.33%
72
Outperform
$18.13B12.1317.27%1.52%-6.68%-32.96%
SISID
55
Neutral
$1.92B-8.49%14.25%-3.74%-50.39%
XX
49
Neutral
$8.35B23.713.43%0.54%-13.48%-56.94%
47
Neutral
$2.64B-3.82-29.05%3.32%2.72%-29.50%
CLCLF
44
Neutral
$4.46B-10.36%-12.78%-301.57%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SID
Companhia Siderúrgica Nacional
1.46
-1.49
-50.51%
MT
ArcelorMittal
30.52
4.00
15.08%
CLF
Cleveland-Cliffs
9.79
-10.64
-52.08%
NUE
Nucor
130.86
-50.56
-27.87%
STLD
Steel Dynamics
123.53
-8.48
-6.42%
X
United States Steel
38.05
-2.60
-6.40%

Companhia Siderúrgica Nacional Earnings Call Summary

Earnings Call Date: Mar 12, 2025 | % Change Since: 0.00% | Next Earnings Date: May 5, 2025
Earnings Call Sentiment Positive
The earnings call presented a largely positive outlook, with strong operational performance across segments, significant cost reductions, and strategic financial management. However, the impact of weak international prices and import challenges posed notable concerns.
Highlights
Growth in Production and Sales
CSN reported growth in production and sales across all segments, showcasing operational excellence and cost reduction efforts.
Mining Segment Performance
Mining had a record performance with production costs reduced to $19 per ton, $9 below the previous quarter.
Strong Steel Market Dynamics
Domestic steel sales grew 9% quarter-over-quarter, with a 20% increase in EBITDA.
Cement Segment Achievements
Cement sales volume reached 3,600 tons with a 37% increase in EBITDA year-over-year and a profitability margin 28% above the sector average.
Significant Cash Management
CSN added BRL 3.7 billion to cash reserves, reducing net debt from BRL 37 billion to BRL 34 billion.
CMIN Stake Sale
The sale of a CMIN stake brought in more than BRL 4.4 billion, aiding in leverage reduction.
ESG Initiatives and Achievements
Significant progress in ESG goals, including a 10% reduction in CO2 emissions in the steel segment and a full year without worker fatalities.
Lowlights
Weak International Prices Impacting EBITDA
Weak international prices negatively impacted the consolidated EBITDA, despite operational improvements.
Persistent Import Challenges
High import penetration in the steel market, with flat steel imports at 24% and prepainted at 30%.
Impact of Currency Fluctuations
Exchange rate fluctuations, particularly with the dollar, posed challenges to financial stability.
Company Guidance
During the CSNA3.SA earnings call for the third quarter of 2024, the executives highlighted several key metrics indicating the company's performance and strategic direction. The company achieved a substantial cash boost, adding BRL 3.7 billion, despite being challenged by weaker international prices, leading to a slight drop in EBITDA. The mining segment recorded its highest production with costs reduced to $19 per ton, while the steel segment saw a domestic sales growth of 9% and a 20% increase in EBITDA. Cement sales reached 3,600 tons, with EBITDA rising by 37% compared to last year, and the logistics sector delivered a 4% EBITDA increase. The company successfully closed the sale of a CMIN stake, adding more than BRL 4.4 billion to its balance, and announced the issuance of BRL 500 million in new debentures to further strengthen its cash position for the fourth quarter. The adjusted EBITDA for the quarter was BRL 2.3 billion, with a 20% margin, reflecting the company's efforts to mitigate the impact of international pricing pressures.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.