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Ternium S.A. – Iron and Steel Mills and Ferroalloy Manufacturing
Ternium is Latin America's leading flat steel producer, with operating facilities in Mexico, Brazil, Argentina, Colombia, the southern United States and Central America. The company offers a broad range of high value-added steel products for customers active in the automotive, home appliances, HVAC, construction, capital goods, container, food and energy industries through its manufacturing facilities, service center and distribution networks, and advanced customer integration systems.
Analysis Results
Intrinsic Value $2,764.12
Latest Price $41.20
Relative Value 99% undervalued
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Cash Flow (Billions)
Analysis Parameters
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Analysis Details
Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 44.7%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 7.4%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 44.7%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year Future flow (billion) Present value (billion)
2022 8.79 8.18
2023 12.7 11.0
2024 18.4 14.9
2025 26.6 20.0
2026 38.6 27.0
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 727 billion. This corresponds to a present value of 473 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 81.1 billion. Adding in the terminal value gives a total present value of 554 billion.

There are presently 200.0 million outstanding shares, so the intrinsic value per share is 2764.12.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 8,604,623,000
Current Cash 2,567,006,000
Current Liabilities 3,213,764,000
Current Debt 866,944,000
Non-Cash Working Capital (NCWC) 3,690,797,000
Change in NCWC 1,895,850,000
EBIT 5,671,868,000
Tax Provision 1,397,139,000
Depreciation and Amortization 591,790,000
Capital Expenditure -523,610,000
Unlevered Free Cash Flow 6,261,169,629
Current Assets 4,561,809,000
Current Cash 1,351,355,000
Current Liabilities 1,853,597,000
Current Debt 438,090,000
Non-Cash Working Capital (NCWC) 1,794,947,000
Change in NCWC -481,204,000
EBIT 1,137,028,000
Tax Provision 291,488,000
Depreciation and Amortization 631,051,000
Capital Expenditure -560,013,000
Unlevered Free Cash Flow 440,988,497
Current Assets 4,176,115,000
Current Cash 732,167,000
Current Liabilities 1,768,125,000
Current Debt 600,328,000
Non-Cash Working Capital (NCWC) 2,276,151,000
Change in NCWC -434,024,000
EBIT 925,533,000
Tax Provision 196,518,000
Depreciation and Amortization 661,112,000
Capital Expenditure -1,052,252,000
Unlevered Free Cash Flow -119,679,168
Current Assets 4,423,889,000
Current Cash 295,070,000
Current Liabilities 1,826,530,000
Current Debt 407,886,000
Non-Cash Working Capital (NCWC) 2,710,175,000
Change in NCWC 101,844,000
EBIT 2,211,143,000
Tax Provision 369,435,000
Depreciation and Amortization 589,299,000
Capital Expenditure -520,250,000
Unlevered Free Cash Flow 1,979,945,586
Current Assets 4,392,520,000
Current Cash 470,515,000
Current Liabilities 2,827,274,000
Current Debt 1,513,600,000
Non-Cash Working Capital (NCWC) 2,608,331,000
Change in NCWC 1,256,097,000
EBIT 1,524,899,000
Tax Provision 336,882,000
Depreciation and Amortization 474,299,000
Capital Expenditure -409,402,000
Unlevered Free Cash Flow 2,468,111,249
Current Assets 2,690,066,000
Current Cash 328,233,000
Current Liabilities 1,831,492,000
Current Debt 821,893,000
Non-Cash Working Capital (NCWC) 1,352,234,000
Change in NCWC -42,878,000
EBIT 1,156,342,000
Tax Provision 411,528,000
Depreciation and Amortization 406,890,000
Capital Expenditure -435,460,000
Unlevered Free Cash Flow 659,426,493
Current Assets 2,570,537,000
Current Cash 388,594,000
Current Liabilities 1,700,617,000
Current Debt 913,786,000
Non-Cash Working Capital (NCWC) 1,395,112,000
Change in NCWC -748,525,000
EBIT 366,529,000
Tax Provision 207,320,000
Depreciation and Amortization 433,788,000
Capital Expenditure -466,643,000
Unlevered Free Cash Flow -699,347,730
Current Assets 3,334,113,000
Current Cash 363,298,000
Current Liabilities 2,091,386,000
Current Debt 1,264,208,000
Non-Cash Working Capital (NCWC) 2,143,637,000
Change in NCWC 469,012,000
EBIT 242,763,000
Tax Provision 339,105,000
Depreciation and Amortization 414,797,000
Capital Expenditure -443,463,000
Unlevered Free Cash Flow 344,004,000
Current Assets 3,201,692,000
Current Cash 475,852,000
Current Liabilities 1,849,159,000
Current Debt 797,944,000
Non-Cash Working Capital (NCWC) 1,674,625,000
Change in NCWC -245,033,000
EBIT 1,075,827,000
Tax Provision 349,426,000
Depreciation and Amortization 377,133,000
Capital Expenditure -883,317,000
Unlevered Free Cash Flow -74,314,299
Current Assets 3,643,610,000
Current Cash 720,116,000
Current Liabilities 2,125,446,000
Current Debt 1,121,610,000
Non-Cash Working Capital (NCWC) 1,919,658,000
Change in NCWC -129,207,000
EBIT 565,153,000
Tax Provision 264,567,000
Depreciation and Amortization 370,855,000
Capital Expenditure -1,022,592,000
Unlevered Free Cash Flow -546,793,618

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