Vale Stock - When To Buy It? NYSE: VALE
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- čas přidán 22. 08. 2024
- Vale stock looks cheap with a PE ratio of 6 and a dividend yield of 11%. Here is my discussion on how and when to buy a cyclical.
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Thanks Sven. I appreciate what you do with these videos. I think you help me train my frame of mind. As a thanks, I watch all the ads when your videos come available.
Great to hear!
I picked up a small position of VALE a week or so ago. Although I agree with Sven about being caught flat-footed in a cyclical downturn. I myself got caught flat-footed with BHP about 10 years ago and that was precisely the problem. All the mining companies decided make huge investments and to ramp up production together. Anyway, being a lot more cautious now.
BTW Just bought Sven's book. Modern Value Investing (available on Amazon either hard copy or e-book) Excellent book. Well worth the read! Its always pays to go back to first principles of value investing to understand the logic of value investing. That way you will make money consistently if you approach investing with the right mindset. Anyway, kudos Sven!
thanks and enjoy the read!
Sven, I think PYPL now became value investment with an upside of extra advertising revenues adding to their existing business.
thanks for sharing!
Thank U. Your rate of output lately has been really impressive. Great topics + the community is making some sensible requests too. Really enjoying the content + learning 🙏
thanks!
Nice video as always. An update on lithium stocks (like ALTM or PLS Pilbara Minerals) would be very interesting. what do you think, now they seem way cheaper.
Yes, that would be very helpfulL!
Indeed , would love to hear about albemarle aswell
I bought arcadium Lithum thanks to Sven and lost 30% :D
@@nachhilfehvm take responsibility for your own actions.
Btw if you bought the stock back then that means you like the stock and did your research. So now it has a 30% discount for you to add to your posn
@@LDP.. yeah, exactly, this is why i don't understand why people panic in situations like this. No major bad news came out for ALTM. Like bro you bought the stock for a reason at a price 30% from now, you should be extremely happy to be able to buy more of it at this price.
Sven, thank you for another excellent video. Your analyses are always thought provoking, even when I don't entirely agree with your conclusions.
In this case, I don't know much about VALE. At the beginning you mentioned they are involved in BOTH iron and copper. I wish your analysis had covered the copper aspect as well. How big a part is copper in VALE's business? With the major push by industrialized countries to move away from fossil fuels and towards more electrification there will be continued growth in copper demand, which should be good for VALE if that's an important share of its business.
Also, at 5:16 you say that the iron cycle is at a high point. I would point out that VALE's share price, on the other hand, is very, very low. So that is both worrying and looks like an opportunity.
Anyhow, thanks again. I really appreciate and learn from your videos.
copper is not significant for the company!
If it happend finaly with the recession you keep calm and buy more this stock like rio tinto. No worry at all until the have big dept issues in the future or semething else. But hey risky business can be everywhere. Thank for you coution and thouhts sven, that help me to prevent big misstakes.
:-)
Heading to $9. Just look where the downward channel on the chart ends.
Hi Sven. U forget we still are in a high inflation environment. BRICS are rejecting the dollar as US is printing paper to infinity.
I believe even 100 dollars is very low price as I mentioned in a high inflation environment 🙌
no, because the price depends on supply and the cost of production, it is still at $22
Vale is A significant Copper producer as well, 326,000 metric tons in 2022
I’ve owned Vale for about two years, five percent allocation dripping in weekly.
thanks for sharing!
Thank-you for the industry update!
🥈
my pleasure!
Thank you Sven, great point!!
My pleasure!
Hey Sven, due Diligence you forget about the risk of payment for the envirement disaster in brazil. Thats why this Vale seems cheap. We talking about 15 billion dollars of indemnization. Wait until this goes official. Thats 15% of atual market cap, it for short term tank the equity and can be worse if this combines with a global recession
this is actually what is preventing me from buying this company
That is 100% priced in IMO, and Vale is paying around what they recommended to the Court. I agree it could be the reason for weakness though. Also, we have been in a global manufacturing recession for around two years now, and China is in a borderline depression. Where is this catalyst for iron ore prices that did not even materialize in the worst days of COVID? This thing is a strong buy IMO.
thanks for sharing, but VALE isn't cheap at all now!
It's obvious, but it is good to be reminded. Thanks!
Thanks!
Sven, you are missing the political turmoil impacting Vale. Brazil elected a socialist president in January 2023. Luis “Lula” da Silva is accused of corruption and embezzlement of public funds. The Brazilian government, with its Golden Shares, has the power to choose Vale’s CEO, just like Lula did with Petrobras in May of this year. The new Petrobras CEO was chosen because she has a pro-government agenda and is willing to finance projects aimed at obtaining public support for the current government rather than returns to shareholders. Lula publicly signaled in January 2024 that he also wants a pro-government CEO in Vale. Be aware that Vale could be transformed into the next electoral piggy bank for Lula and his socialist party.
good points, thanks for sharing!
Thats hearbreaking, I was studying this company , all its stats align with what I like and am searching for, seems like a really good management team...I went to read on ceo vs Lula and found in Dec it will happen what you say...corruption really is the humanity's cancer.
To the channel creator: Nice vid, just found you cause of Vale. Subbed.
Ya because that fascist Bolsonaro that said the Amazon was open for business was better? I don't think you can have any moral politicians in places like that.
@@Value-Investing Hi Sven, Let me start by saying that I greatly enjoy your channel. I'm reaching out to propose a new topic. As I mentioned above, Vale's stock is currently being impacted by concerns over who the Brazilian government may appointment as Vale’s next CEO and that CEO’s directive. When determining a fair price for Vale's shares, how would you incorporate this risk? Could we leverage the recent impact observed on Petrobras' stock because of its recently government appointment new CEO? Or is this too complex to quantify, and hence we should simply avoid Vale's stock entirely? Aswath Damodaran has a video where he tries to assess the risk of a volcano impacting a business in Iceland on its publicly traded shares, Aswath’s insights may offer a foundational approach to my question. Cheers!
You are giving us Gold with these videos!👏🏽
thanks!
Actually more like Iron Ore.
i realize sven isn't big on etfs but you can buy a brazil etf with less risk and get a 6 or 7% div most of which are at or near mutli-year lows
thanks for sharing!
thx for your videos!
same thing for PBR?
I'm thinking of adding some commodity related stocks, and these two (like the BRA market, also) come in mind - for their good numbers, big dividends, global demand;
one more factor to consider is the government, the (always) possibility of nationalization or other interference from the Brazilian regime (esp if it changes)...
I own PBR too
Me too
thanks for sharing!
Ferrexpo is a iron ore recovery play on the Russia Ukraine war coming to an end.
Big potential from current prices.
thanks for sharing!
Thanks Sven! Hoegh Autoliners at >20% dividend yield looking interesting from value perspective?
thanks for suggesting!
I have only one take... u have to adjust the iron ore price to inflation.... In 1998 the year low for oil was 9$
their cost is still $23, thus adjusted!
Grazie sven per i tuoi video puoi parlare quando puoi ancora del settore Agricoltura, cosa ne pensi e le azioni che sceglieresti come qualche anno fa'? Grazie
fertilizanti sono di nuovo giu, e un ciclo da guardare
Copper is forecast to boom by some economists, Vale is A significant Copper producer 326,000 metric tons in 2022, Vale is forecast to increase copper production ?
Good video, very informative
how much dividend vale =pay for shareholder in dollars in 2024 ? why they paying only 31 cent per share on september ???
Hello Sven, great video.
What do you think about the Schaeffler Group? It is pretty low right now.
Is it worth to invest right now or is it better to wait until the end of August, when the next end of year rally starts?
Thanks for your interesting videos and work! Keep up the good work!
that is an industrial, so watch the economy there
Hello Sven, do you sell all your investment during bubbles like currently or 2008? And how do you deal with the fear of missing out?
I am not missing out, I own businesses!
Can you make a video about Vermillion Energy? It looks extremely cheap by numbers.
uh, oil and gas, don't know if right moment in time
ILF ETF with Vale as largest holding might be a good alternative. Even lower overall valuation and maybe a more diversified play on cheap LatAm40
thanks for sharing!
Many thanks!! 🙏
You are welcome!
Hello, Sven,
I have a suggestion for a video. I've been getting more and more interested in Charlie Munger and Terry Smith's style of investing lately. Especially on ROIC and ROE.
As a value investor, could you elaborate on your perspective on these metrics? Do you use them? Then put them in the context of value investing. Maybe a comparison of ROIC and P/E ratios?
Is a company with a ROIC of 15 and a P/E of 20 a value investment for you (the SP500 has a long term average ROIC of 9.5 and a P/E of 16), at what P/E would you feel the margin of safety, etc. Is it something like P/E = 1.5xROIC? Where is the safety margin (P/E equals ROIC?) for a non-dividend paying company. If it pays a dividend, I have to reduce the ROIC by the payout ratio. For example, ROIC 15, payout ratio 33%, that means a real ROIC of 10, the money left over for the company to reinvest.
Thank you.
it shows the quality of the business, but that you can also see from the cash flows!
Thank you sven made another 3% with nvidia today. 30% of your yearly gain. Thank you for the advice to buy this stock.
Great for you!
Agree 100% Bought and sold Vale many times over the years. The last time I bought was on the day of the Brumadinho disaster. Bought at R$30 and sold a few months later at R$60. Then it went up to R$125 (missed that bit, but 100% profit is better than a slap in the face). Now it is back to R$ 60 and I am waiting for the R$ 30 opportunity again.
that is how it is done!
Hello Sven, could you please cover Petrobras?
too political for me!
Thanks for the update. Interesting business.
:-)
Hi Sven, could you reassess lithium market after the continue drop in 2024? I'm looking into ALTM
I think I will check again in 2026 as discussed given the wall of supply!
Frankly , having the Brazil govt hold shares in VALE is a Great thing.
1. Ensures the dividend is maintain.
2. Ensures management doesnt steal money
3. Ensures political redtapes are minimal.
Never make the govt your enemy.
Hi Sven, I would like to learn your point-of-view on Paramount Global. Many thanks
last time discussed here: czcams.com/video/D42MexN46PI/video.html
Can you do an analysis of Brookfield Corporation (BN) ?
thanks for suggesting!
I have good position in VALE. Should I sell now and buy back in the crash? Why VALE no mine the gold? VALE no have gold? Why?
Hi Sven, you put up a short list of HK names a few videos back and I noted a couple of private Education companies I wasn't familiar with, neither of which seems to be in your covered list. China New Higher Education Group in particular is a 3.4b company, has been growing revenue at a 30% CAGR over the past 5 years with over 30% margins, has been recently reducing shares outstanding and paying down some debt, with a 50% dividend payout ratio that at current prices translates into a near 11% yield. How can a company that has been growing revenues at 30% trade at 4x earnings? Is this collateral damage from the online tutoting crackdown from a few years ago? Cheers,
3.4 billion HKD is about 400 million USD, thus likely flying under all radars. Will recheck the list, thanks!
@@Value-Investing Considering that most degrees last around 4 years, a good chunk of the 4 years of earnings one would be paying for the shares today is essentially recurring. I checked the first college they list on their website: Yunnan Technology and Business University. Google says there are 28k students there and that the average annual tuition is RMB10k, plus RMB1.8k for accomodation: that amounts to RMB330m, or 15% of the group's revenue. However, the college's website looks a little fishy (poor English, only 7 tabs, the fee section is empty). The university was founded in 2005 but I can't find alumni anywhere. This doesn't inspire too much confidence. I found a few campus videos on CZcams posted by students: I reached out to see what they think. This is not the kind of fundamental research I normally do...
inflation changes the prices of basic materials. So maybe you need to correct the baseline also for this?
their cost is still $22 per ton, thus it is for 2023 and same projected for 2024
Thanks
thank you!
@@Value-Investing after watch ur video i worried my cost basis is 11.40 if drop i will loose more can o sell it now
Hello Sven
PayPal is an interesting stock now. Value trap vs undervalued. New CEO is intelligent and likely can turn around the company to become cash cow.
Would love your opinion
are they growing? so much competition
@@Value-Investing that is the question. Even if they grow 5%, this can lead to great returns if capital allocation is done properly. Stock buy back makes sense now for this company
Thanks Sven!
My pleasure!
Could you do an analysis of LNTH? It has an amazing growth in the past few years, it has an estimated growth of over 30% annually for the next 5 years, and it's undervalued - PE of 12 and PEG of 0.6
thanks for suggesting!
@@Value-Investing It just went up 36%...
I have 6 digits worth of Vale and im down 40%
U buying now?
it is a cyclical
Can you do a vid about positions heading into a recession? Is holding cash the best bet?
can you predict a recession - the key is to be positioned well all the time!
Can you do a video on baidu and paycom?
thanks for suggesting!
This guy knows I bought zim cheap no div and no prospects double easy baby
good for you!
thank you!
Thank you!
Can you take a look at PBR?
ah, too political for me!
the classic [potential] "value trap"
at least you can see it here from far!
Great advice
thanks for sharing!
Yes. Clever guy
thanks!
I think iron ore demand from China will go down as their demand for steel for construction seems to be stagnant.
However, I think emerging markets in Asia and Africa will be demanding higher amounts of iron in the next years.
I’m not investing here, just my take given the macroeconomic trends.
thanks for sharing!
What about the militar demand for Steel with the current political tension escalation? Moreover if Germany alone put in place its wind energy policy, there will be shortage of steel in the world for the construction of windmills...
military demand? that means war, that means fewer investments globaly, think about it!
🗽 What about Rio Tinto? Do we have to wait for the next really ugly ??
.
hard to predict that :-(
could some PGMs companies like Sibanye Stillwater be in that tough (sweet) spot?
did here last time: czcams.com/video/B2L08l-osCg/video.html
Sven every copany i think off you make a video on. Just thank you
:-))) I can read your mind!
10.40 is good buying price...
How's NUE and CMC looking? Seem cheap.
cheap, only if you take the chart of last 12 months, check the longer term chart
When I hear Vale I think of the Brumadinho dam disaster. I'll pass on this one.
good point, thanks for sharing!
I am brazilian. Vale is a superb conpany. I am buying more. BTW, Vale beats the allmighty SP 500 (including dividends) since its IPO.
@@kqh123 PBR is extremaly cheap, but with risks of bad government interference, which can destroy value. I prefer Brazilian banks, which are also very cheap and have a great track record (ITUB or BDORY). ITUB has a history of yielding 13% per year, in dollars, since the IPO in US (2002), beating the powerful S&P 500 in the long term.
thanks for sharing!
Better to stay in cash now.
thanks for sharing!
Im Researching cliffs natural resources. 6 bio market cap, 17 billion balace sheet and 1.5 billion buybacks. Could be interesting
thanks for sharing!
What about lithium? looks ugly there specialy Alb altm
will have to check and update
@@Value-Investing
Altm and lithium overall looks like kind of stock and sector that you always describing, bottom of the cycle ( or almost, but sure looks ugly), no body likes it but good company, diversified, 90 years in the industry, after merger that will cost save for sure. Waiting for your opinion but about to open small position. If i listened to you for the last 3 years looks like stock to buy. Hope i learned good 😀
Vale's price is this depressed because of all the legal liability related to a 2015 dam breach( i think the most resent count of the liability around 25b dollars) plus it's pretty much a state controlled business. If the legal liability wasn't there. It would be the mid 20's low 30's right now
thanks for sharing, the price is high now, not depressed!
What % of vale revenue is iron
other metals aren't relevant!
@@Value-Investing Ty
Other mining question. U made a video about lithium miners a few months back. Any thoughts on investing in lithium companies when sodium batteries may or may not largely displace them in ?? years? General thoughts on how investment risks in a cyclical industry might transform when it’s also in a segment of the economy that is rapidly advancing and possibly causing partial obsolescence?
Are you not aware of the court case involving vale being responsible for that massive flood in brazil, where they’re going to have to pay billions of dollars in damages?
didn't they pay already most of the billions for the two disasters there?
@@Value-Investingfrom what I read yesterday they had only paid like 1/4 of it so far.
Cemig-CIG
that one I know:)
And what about the 40 billion law suit up their arse??
40 billion???? 😲
@@afonsodeportugal yep, was the initial claim (in $ reals) against Vale and BHP for the dam breach. Likely to settle around 20 billion
@@jackouille2024 Holy c, thanks for the info! 👍
thanks for sharing!
PAYC NEXT?
thanks for suggesting!
commodities prices are going down only
that is the cycle!
Neoenergia SA
thanks for suggesting!
I prefer lithium right now
thanks for sharing!
This and energy will fall hard if a recession will to come!
thanks for sharing!
11% yield? Rarely sustainable, to each their own.
the yield on stocks in Brazil is much higher than it is in the us to start with
as said in the video, watch the cycle!
when it comes to cyclicals, you let the pros do it and just buy the etf. otherwise, you'll get caught.
ETFs are cyclical too, it is just a bigger cycle that you don't see yet!
wow Sven talking about speculation (value investing channel 😂).
just discussing the cycle
Vale and Petrobras (PBR) are heavily influenced by the Brazilian government. In fact, the president of Vale is usually appointed by the President of Brazil. As a Brazilian, I would never risk buying shares of Vale and Petrobras due to the systemic corruption that exists in Brazil.
thanks for sharing, important point!
Alright Seven we don't need these penny stock videos. Hold my beer while I make BANK on Nvidiaaaaa 🐂
:-)))))
20% decline each year
depends on the cycle
The number one thing I've learned from you, Sven, is that your advice is best enjoyed on mute. Here you are again, with another P/E story, singing the praises of high dividends like it's a chart-topping hit. Then you roll out your trusty diagrams and technical analyses, like a magician with the same old trick. Give it a rest, buddy. When it comes to Vale, shareholders might as well be chasing rainbows. Whatever you get in dividends, you’ll lose later to the inevitable stock value nosedive.
I think you should watch the video if you are interested in the stock, if not, get a life!
@@Value-Investing Sven, with your background, you could always consider becoming a high school teacher. It's a respectable profession, and the qualifications aren't too demanding. Just kidding, buddy-I'm just teasing you a bit. I challenge you to write another piece about Nvidia and Vale, which you mentioned in this video, a year from now.