NATIONAL STEEL CO (SID) Stock Analysis
NATIONAL STEEL CO
▾ What's in the 51/100 risk score? (higher = riskier)
Contributions (weight × component score) sum to the total. This near-term score now includes fundamental health (leverage, FCF trend). See the Financial Health section for the full balance-sheet read.
How to read SID (cyclical commodity producer)
A miner or energy producer earns whatever the commodity price is, so a single DCF swings with the cycle. Judge it against peers and where you think the commodity cycle is heading.
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EV/Sales peer comparison ↓
How the price compares to similar producers is more meaningful than a through-cycle DCF.
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Interactive calculator (test cycle assumptions) ↓
Flex the growth/discount inputs to see how sensitive the value is to where we are in the cycle.
Standard DCF doesn't fit SID well — but that's expected for this kind of business. The EV/Sales Peer Comparison below uses the metrics actually used by analysts who value steel. Reverse DCF + Football Field also work as cross-checks.
Miners, metals and energy producers earn whatever the commodity price is at the time. A discounted-cash-flow model leans on recent cash flow, so it swings with the cycle: the result is dominated by where we are in the commodity cycle rather than by durable business economics.
For this business type, lean on the EV/Sales peer comparison and Reverse-DCF below (how today's price compares to similar producers and what growth it implies), and weigh the commodity-price outlook. Treat the DCF number as a rough mid-cycle reference, not a buy/sell trigger.
Quality & solvency checks
Cheap stocks can be cheap for a reason. These screens warn when a low valuation comes paired with structural fragility.
Why it matters: Cheap-looking stocks (low P/E or P/B) often have low Z-scores because the market knows the company is dying. Z-score warns you before you fall into a value trap.
Reference: > 3.0 = safe zone · 1.81–3.0 = grey zone · < 1.81 = distress zone
Full explanation →
The Z-score needs working capital, retained earnings, EBIT, sales and total assets from the latest balance sheet, and at least one of those isn't reported in machine-readable form here — common for foreign private issuers. We leave it blank rather than compute a distress verdict from an estimated input. It doesn't affect the reported figures in the financial tables below.
▾ The checks — what passed, what didn't (and what we couldn't measure)
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✓ Positive net incomeNet income $1,281.0M in FY2009.
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✓ Positive operating cash flowOperating cash flow $40.0M (was $2,067.0M the prior year).
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✗ Cash flow backs up reported profitOperating cash flow $40.0M vs net income $1,281.0M.Why this matters: When cash generated exceeds reported earnings, profits are high-quality (not propped up by accruals or one-time items).
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✗ Return on assets improvingReturn on assets 6.7% vs 16.9% a year ago.Why this matters: Is the company squeezing more profit out of each dollar of assets than last year? Rising = getting more efficient; falling = the opposite.
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✓ Debt load (vs assets)The filing reports no interest-bearing debt in either year (total assets $19,188.0M).
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✓ Short-term liquidity (current ratio)Current ratio 3.27x vs 1.92x a year ago.
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✓ Share count (dilution)Share count declined 2.7% (1,534,067.0M → 1,492,453.0M year-over-year), so the no-dilution check passed. (One-year change; the multi-year buyback pace can differ.)
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· Pricing power (gross margin) (n/a — data not reported; not scored)
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· Sales per asset (asset turnover) (n/a — data not reported; not scored)
Missing data is never counted as a pass or a fail — it's shown as n/a and excluded from the denominator. Each check compares the company against its own prior year.
A standard DCFDCF — Discounted Cash Flow — sums up all future cash a business will produce, adjusted for the fact that future dollars are worth less than dollars today.
Why it matters: It is the most fundamentally honest valuation method when applicable — but only works for companies with predictable, positive cash flow.
Reference: Best for: mature, profitable businesses. Fails for: pre-profit growth, banks, REITs.
Full explanation → valuation is not meaningful for SID due to its cyclical nature and historical negative free cash flowFree Cash Flow (FCF) — Operating cash flow minus capital spending: cash left after a company covers operating costs, taxes and interest and reinvests in the business — but BEFORE repaying debt principal or paying dividends. The cash actually available to investors.
Why it matters: A company can show big profits on paper while burning through cash. FCF is what actually fills the bank account.
Reference: Healthy mature businesses convert 8–15% of revenue into FCF · Growth companies often negative
Full explanation → growth, which reflects commodity cycle peaks and troughs. While the company is currently profitable and cash flow positive, its valuation is likely driven by market expectations for future steel demand and commodity prices. Investors are betting on the company's ability to navigate these cycles effectively. The #1 quantifiable risk is the historical FCF decline of 6.8%, indicating sensitivity to commodity price fluctuations.
As of 3 months ago
Anatomy of a share
What you're buying per share. Bars are at the same scale so you can see the relative size of revenue, costs, cash flow, and debt — not just read them in a table.
What you actually need to decide
Every stock price is a disagreement. Here's the single thing that must go right for the bulls, the single thing that breaks the thesis, and the concrete signposts to watch so you can update your view as real results arrive.
Why it matters: A company can show big profits on paper while burning through cash. FCF is what actually fills the bank account.
Reference: Healthy mature businesses convert 8–15% of revenue into FCF · Growth companies often negative
Full explanation → of $505.60M, indicating sustained demand and favorable commodity prices.
Why it matters: A company can show big profits on paper while burning through cash. FCF is what actually fills the bank account.
Reference: Healthy mature businesses convert 8–15% of revenue into FCF · Growth companies often negative
Full explanation → could decline significantly, impacting profitability and investment capacity.
- Quarterly steel production volumes
- Global iron ore price trends
- Automotive and construction sector demand
The trend, in plain numbers (FY2008 → FY2009, latest reported)
Straight from the financial statements — no model, no opinion. For a small or unprofitable company, the direction of these numbers usually tells you more than any single valuation.
- Free cash flow is negative at -$890.0M — the cash burn widened vs last year.
- Net income fell -52% to $1.28B.
Nothing was clearly improving year-over-year.
Management & Leadership
SID, or Companhia Siderúrgica Nacional, is a Brazilian multinational steel company. The current CEO is Benjamin Steinbruch, who also serves as the Chairman of the Board. He has been a prominent figure in the company's leadership for many years, guiding its strategic direction.
What They Make
SID produces a wide range of steel products, including flat steel, long steel, and galvanized products, primarily serving the automotive, construction, and packaging industries.
End Markets
Revenue Drivers
Why Is It Priced Like This?
Why Customers Pay
What we use instead: earnings (P/E, EV/EBIT), book value (P/B) — computed from the figures this company does report, shown in the sections below. Those numbers are unaffected by the missing cash-flow data.
The market is likely pricing SID based on its current positive net income and operating cash flow, alongside expectations for future steel demand and commodity prices. Despite a historical FCFFree Cash Flow (FCF) — Operating cash flow minus capital spending: cash left after a company covers operating costs, taxes and interest and reinvests in the business — but BEFORE repaying debt principal or paying dividends. The cash actually available to investors.
Why it matters: A company can show big profits on paper while burning through cash. FCF is what actually fills the bank account.
Reference: Healthy mature businesses convert 8–15% of revenue into FCF · Growth companies often negative
Full explanation → decline of 6.8%, the current ratio of 3.27 suggests adequate liquidity, which investors may view as a buffer against cyclical downturns, focusing on the company's ability to generate cash in the current cycle.
Business Model & Valuation
How They Make Money
The company funds itself through its positive operating cash flow and has been profitable for the last three years, indicating self-sufficiency in capital allocation.
Normalized FCF
Cyclical/commodity sector (Steel) with negative current FCF: normalized FCF uses multi-year median to smooth through the cycle.
Show advanced inputs
| Eps Growth | -11.9% |
| Historical Fcf Growth | 86.9% |
| Sector Default | 5.0% |
| Best Estimate | -6.8% |
| Method | blend(70% eps_cagr, 30% sector) |
| Growth Basis | per_share |
What this model does NOT do: this is a consolidated owner-earnings FCF model. Standalone segment assumptions: none. It does not project production volumes, realized commodity prices and unit cash costs independently; their combined effect is embedded in the historical revenue and cash-flow trend the model extrapolates. The calculator above can only approximate a segment's impact through the single consolidated growth rate — it cannot model any one line separately. For a true segment-level view, build a separate model from the company's segment disclosures.
Maturity & Competitive Position
Moat Signals
Net income and operating cash flow have been positive for the last three years.
Geography & Markets
SID is a Brazilian multinational company with significant operations and sales within Brazil, and also has an international presence, though specific geographic revenue percentages are not available from current data sources.
Geographic Risks
Market Signals
These are timing signals, not value signals — they describe the stock's recent price behavior, not what the business is worth. Use them for the "the thesis looks good, but is now the moment?" question. Each tile below explains what it's saying.
Why it matters: Short-term contrarian indicator. Extreme readings often precede mean reversion, though not always.
Reference: 30–70 normal · >70 overbought · <30 oversold
Full explanation → (14)53.4NeutralMomentum is balanced — neither overbought nor oversold.
Why it matters: When the fast line crosses above the slow line, short-term momentum is turning up; below, turning down. A timing cue, not a value signal.
Reference: Line above signal = bullish momentum · below = bearish
Full explanation →BullishLine above signalThe fast trend is above the slow trend — short-term momentum is currently upward.
Technicals describe price, not the business. A great company can have a "bearish" tape (a buying chance) and a weak one a "bullish" tape (a trap). Pair these with the valuation and health sections above.
QUALITY
Data Quality & Risk Flags (6 notes — click to expand/collapse)
Guardrail Notes (5)
- Cyclical sector: using normalized cash flow (median OCF minus estimated maintenance capex).
- Median OCF: $1.26B, est. maintenance capex: $758.40M, normalized FCF: $505.60M.
- Historical FCF growth is negative (-6.8%) - likely reflects commodity cycle peak. Flooring at 0%.
- Model implies no positive equity value under these assumptions. Valuation is speculative/low-confidence.
- Illiquidity discount 7% applied (small/micro-cap — harder to exit, demand a margin).
FINANCIALS
Financial Statements (5-year tables — click to expand)
From NATIONAL STEEL CO's SEC filings (EDGAR).
Income (5yr)
| Year | Revenue | Net Income | EPS |
|---|---|---|---|
| 2009 | — | 1.3B | $0.86 |
| 2008 | — | 2.7B | $1.73 |
| 2007 | — | 1.7B | $1.11 |
Cash Flow (5yr)
| Year | Operating CF | CapEx | − SBC & adj. | Free Cash Flow |
|---|---|---|---|---|
| 2009 | 40.0M | 930.0M | — | -890.0M |
| 2008 | 2.1B | 886.0M | — | 1.2B |
| 2007 | 1.3B | 632.0M | — | 632.0M |
How we define FCF: operating cash flow − capital expenditure − stock-based compensation (owner-earnings basis — SBC is a real cost to shareholders even though it's non-cash). This is the same owner-earnings FCF definition the valuation model uses, though the DCF's starting value is a mid-cycle estimate (median operating cash flow less estimated maintenance capex and stock compensation — by design NOT the table's FCF, which deducts every year's full capex), not this single year.
Balance Sheet
| Total Assets | 19.2B |
| Total Liabilities | 14.9B (derived) |
| Equity | 4.3B |
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