Is ArcelorMittal SA ADR (MT) overvalued?
On Equity Rank's model estimate, MT trades 11% above its fair value. ArcelorMittal SA ADR (MT) last closed at $60.98; the multi-method model fair value is $55.10.
| Price | Model fair value | Price vs model |
|---|---|---|
| $60.98 | $55.10 | 11% above |
What the answer rests on
- 2 of 12 valuation methods put MT's value above its price and 10 put it below, so the methods mostly agree.
- To justify today's price, MT's free cash flow would need to grow about 35.6% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew -58.8% a year.
- MT trades at 26.4 times its last year's earnings, against a median of 17.7 for 8 profitable Steel companies.
- Over the past year the price sat below the model fair value on 1% of trading days. The gap ranged from 2% below to 33% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind MT's fair value · What prices assume · Other companies