2024-05-07 07:56:05 ET
Summary
- Gerdau has a good track record and the most internationalized operation among Brazilian steel companies. The Brazilian steel industry is facing challenges due to the large supply of Chinese steel.
- The government's proposed 25% tax on Chinese steel is insufficient to combat the competition, making it unfeasible to recommend buying Brazilian steel producers at the moment.
- The company trades at the lowest EV/EBITDA multiple among its competitors. However, there is a lack of trigger to make the thesis more attractive.
Investment Thesis
I recommend holding shares of Gerdau (NYSE: GGB ). Gerdau has a good track record of results and the most internationalized operation among its Brazilian peers. Furthermore, it trades at the lowest EV/EBITDA multiple among its competitors....
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Gerdau: Chinese Steel Taxation Frustrates Brazilian Investors