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Stelco Holdings

TSX:STLC
Snowflake Description

Excellent balance sheet and good value.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
STLC
TSX
CA$2B
Market Cap
  1. Home
  2. CA
  3. Materials
Company description

Stelco Holdings Inc. produces and sells various steel products in Canada and the United States. The last earnings update was 29 days ago. More info.


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STLC Share Price and Events
7 Day Returns
-1.6%
TSX:STLC
-1.5%
CA Metals and Mining
0.9%
CA Market
1 Year Returns
-29.3%
TSX:STLC
-7%
CA Metals and Mining
1.2%
CA Market
STLC Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Stelco Holdings (STLC) -1.6% 5.4% 14.2% -29.3% - -
CA Metals and Mining -1.5% 1.3% 9.8% -7% 6.9% -22.5%
CA Market 0.9% 2.3% 12.4% 1.2% 16.1% 5.9%
1 Year Return vs Industry and Market
  • STLC underperformed the Metals and Mining industry which returned -7% over the past year.
  • STLC underperformed the Market in Canada which returned 1.2% over the past year.
Price Volatility
Industry
5yr Volatility vs Market

Value

 Is Stelco Holdings undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Stelco Holdings to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data    Our intrinsic value calculation method has changed recently, learn more here.

Below are the data sources, inputs and calculation used to determine the intrinsic value for Stelco Holdings.

TSX:STLC Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 6 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 9.1%
Perpetual Growth Rate 10-Year CA Government Bond Rate 1.9%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for TSX:STLC
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year CA Govt Bond Rate 1.9%
Equity Risk Premium S&P Global 6%
Metals and Mining Unlevered Beta Simply Wall St/ S&P Global 1.18
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 1.177 (1 + (1- 26.5%) (13.92%))
1.199
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
1.2
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 1.95% + (1.199 * 5.96%)
9.09%

Discounted Cash Flow Calculation for TSX:STLC using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Stelco Holdings is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

TSX:STLC DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (CAD, Millions) Source Present Value
Discounted (@ 9.09%)
2019 108.67 Analyst x3 99.61
2020 248.00 Analyst x2 208.38
2021 346.35 Est @ 39.66% 266.77
2022 444.52 Est @ 28.34% 313.84
2023 535.32 Est @ 20.43% 346.44
2024 614.98 Est @ 14.88% 364.83
2025 682.64 Est @ 11% 371.21
2026 739.19 Est @ 8.29% 368.46
2027 786.38 Est @ 6.38% 359.31
2028 826.12 Est @ 5.05% 346.01
Present value of next 10 years cash flows CA$3,044.87
TSX:STLC DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2028 × (1 + g) ÷ (Discount Rate – g)
= CA$826.12 × (1 + 1.95%) ÷ (9.09% – 1.95%)
CA$11,786.13
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= CA$11,786.13 ÷ (1 + 9.09%)10
CA$4,936.45
TSX:STLC Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= CA$3,044.87 + CA$4,936.45
CA$7,981.32
Equity Value per Share
(CAD)
= Total value / Shares Outstanding
= CA$7,981.32 / 88.76
CA$89.92
TSX:STLC Discount to Share Price
Calculation Result
Value per share (CAD) From above. CA$89.92
Current discount Discount to share price of CA$17.48
= -1 x (CA$17.48 - CA$89.92) / CA$89.92
80.6%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price Stelco Holdings is available for.
Intrinsic value
>50%
Share price is CA$17.48 vs Future cash flow value of CA$89.92
Current Discount Checks
For Stelco Holdings to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • Stelco Holdings's share price is below the future cash flow value, and at a moderate discount (> 20%).
  • Stelco Holdings's share price is below the future cash flow value, and at a substantial discount (> 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Stelco Holdings's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Stelco Holdings's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
TSX:STLC PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2018-12-31) in CAD CA$2.85
TSX:STLC Share Price ** TSX (2019-03-19) in CAD CA$17.48
Canada Metals and Mining Industry PE Ratio Median Figure of 115 Publicly-Listed Metals and Mining Companies 13.44x
Canada Market PE Ratio Median Figure of 542 Publicly-Listed Companies 14.83x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Stelco Holdings.

TSX:STLC PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= TSX:STLC Share Price ÷ EPS (both in CAD)

= 17.48 ÷ 2.85

6.14x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Stelco Holdings is good value based on earnings compared to the CA Metals and Mining industry average.
  • Stelco Holdings is good value based on earnings compared to the Canada market.
Price based on expected Growth
Does Stelco Holdings's expected growth come at a high price?
Raw Data
TSX:STLC PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 6.14x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 6 Analysts
3.3%per year
Canada Metals and Mining Industry PEG Ratio Median Figure of 35 Publicly-Listed Metals and Mining Companies 0.69x
Canada Market PEG Ratio Median Figure of 252 Publicly-Listed Companies 1.21x

*Line of best fit is calculated by linear regression .

TSX:STLC PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 6.14x ÷ 3.3%

1.88x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Stelco Holdings is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on Stelco Holdings's assets?
Raw Data
TSX:STLC PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2018-12-31) in CAD CA$6.40
TSX:STLC Share Price * TSX (2019-03-19) in CAD CA$17.48
Canada Metals and Mining Industry PB Ratio Median Figure of 1,079 Publicly-Listed Metals and Mining Companies 1.42x
Canada Market PB Ratio Median Figure of 2,347 Publicly-Listed Companies 1.56x
TSX:STLC PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= TSX:STLC Share Price ÷ Book Value per Share (both in CAD)

= 17.48 ÷ 6.40

2.73x

* Primary Listing of Stelco Holdings.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Stelco Holdings is overvalued based on assets compared to the CA Metals and Mining industry average.
X
Value checks
We assess Stelco Holdings's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Metals and Mining industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Metals and Mining industry average (and greater than 0)? (1 check)
  5. Stelco Holdings has a total score of 4/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

Future Performance

 How is Stelco Holdings expected to perform in the next 1 to 3 years based on estimates from 6 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
3.3%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Stelco Holdings expected to grow at an attractive rate?
  • Stelco Holdings's earnings growth is expected to exceed the low risk savings rate of 1.9%.
Growth vs Market Checks
  • Stelco Holdings's earnings growth is positive but not above the Canada market average.
  • Stelco Holdings's revenues are expected to decrease over the next 1-3 years, this is below the Canada market average.
Annual Growth Rates Comparison
Raw Data
TSX:STLC Future Growth Rates Data Sources
Data Point Source Value (per year)
TSX:STLC Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 6 Analysts 3.3%
TSX:STLC Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 6 Analysts -2%
Canada Metals and Mining Industry Earnings Growth Rate Market Cap Weighted Average 33.3%
Canada Metals and Mining Industry Revenue Growth Rate Market Cap Weighted Average 7%
Canada Market Earnings Growth Rate Market Cap Weighted Average 17.9%
Canada Market Revenue Growth Rate Market Cap Weighted Average 6.8%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
TSX:STLC Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 6 Analyst Estimates (S&P Global) See Below
All numbers in CAD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
TSX:STLC Future Estimates Data
Date (Data in CAD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2022-12-31
2021-12-31 2,405 273 281 3
2020-12-31 2,213 283 317 6
2019-12-31 2,360 241 369 6
TSX:STLC Past Financials Data
Date (Data in CAD Millions) Revenue Cash Flow Net Income *
2018-12-31 2,460 390 253
2018-09-30 2,285 189 1,963
2018-06-30 2,002 211 1,808
2018-03-31 1,697 -39 3,607
2017-12-31 1,622 -204 5,366
2017-09-30 1,461 -129 3,463
2017-06-30 1,498 -113 3,475
2017-03-31 1,400 -35 1,620
2016-12-31 1,302 43 -236

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Stelco Holdings's earnings are expected to grow by 3.3% yearly, however this is not considered high growth (20% yearly).
  • Stelco Holdings's revenue is expected to decrease over the next 1-3 years, this is not considered high growth.
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
TSX:STLC Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 6 Analyst Estimates (S&P Global) See Below

All data from Stelco Holdings Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

TSX:STLC Future Estimates Data
Date (Data in CAD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2022-12-31
2021-12-31 3.17 3.17 3.17 1.00
2020-12-31 3.61 4.24 2.97 2.00
2019-12-31 4.16 4.69 3.62 2.00
TSX:STLC Past Financials Data
Date (Data in CAD Millions) EPS *
2018-12-31 2.85
2018-09-30 22.10
2018-06-30 20.36
2018-03-31 40.61
2017-12-31 67.89
2017-09-30
2017-06-30
2017-03-31
2016-12-31

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Stelco Holdings is expected to efficiently use shareholders’ funds in the future (Return on Equity greater than 20%).
X
Future performance checks
We assess Stelco Holdings's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the Canada market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the Canada market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Stelco Holdings has a total score of 2/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

Past Performance

  How has Stelco Holdings performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Stelco Holdings's growth in the last year to its industry (Metals and Mining).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Stelco Holdings has delivered over 20% year on year earnings growth in the past 5 years.
  • Stelco Holdings's 1-year earnings growth is negative, it can't be compared to the 5-year average.
  • Stelco Holdings's 1-year earnings growth is negative, it can't be compared to the CA Metals and Mining industry average.
Earnings and Revenue History
Stelco Holdings's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Stelco Holdings Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

TSX:STLC Past Revenue, Cash Flow and Net Income Data
Date (Data in CAD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2018-12-31 2,460.00 253.00 225.00
2018-09-30 2,284.50 1,963.00 243.00
2018-06-30 2,001.50 1,808.00 244.00
2018-03-31 1,697.00 3,607.00 74.00
2017-12-31 1,621.50 5,366.00 61.00
2017-09-30 1,461.00 3,463.00 37.00
2017-06-30 1,498.00 3,475.00 24.00
2017-03-31 1,400.00 1,619.50 24.00
2016-12-31 1,302.00 -236.00 24.00
2015-12-31 1,347.00 -389.00 28.00
2014-12-31 1,893.00 -233.00 44.00

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Stelco Holdings made outstanding use of shareholders’ funds last year (Return on Equity greater than 40%).
  • Stelco Holdings used its assets more efficiently than the CA Metals and Mining industry average last year based on Return on Assets.
  • Unable to establish if Stelco Holdings improved its use of capital last year versus 3 years ago (Return on Capital Employed) due to insufficient past data.
X
Past performance checks
We assess Stelco Holdings's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Metals and Mining industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Stelco Holdings has a total score of 3/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

Health

 How is Stelco Holdings's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Stelco Holdings's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Stelco Holdings is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Stelco Holdings's cash and other short term assets cover its long term commitments.
Balance sheet
This treemap shows a more detailed breakdown of Stelco Holdings's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • High level of physical assets or inventory.
  • Debt is covered by short term assets, assets are 5.5x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Stelco Holdings Company Filings, last reported 2 months ago.

TSX:STLC Past Debt and Equity Data
Date (Data in CAD Millions) Total Equity Total Debt Cash & Short Term Investments
2018-12-31 568.00 216.00 438.00
2018-09-30 466.00 160.00 347.00
2018-06-30 500.00 93.00 421.00
2018-03-31 517.00 33.00 226.00
2017-12-31 497.00 121.00 250.00
2017-09-30 293.00 11.00 22.00
2017-06-30 306.00 79.00 30.00
2017-03-31 -3,287.00 1,822.00 188.00
2016-12-31 -3,287.00 1,822.00 188.00
2015-12-31 -3,111.00 1,829.00 162.00
2014-12-31 -2,775.00 1,787.00 199.00
  • Stelco Holdings's level of debt (38%) compared to net worth is satisfactory (less than 40%).
  • Unable to establish if Stelco Holdings's debt level has increased without past 5-year debt data.
  • Debt is well covered by operating cash flow (180.6%, greater than 20% of total debt).
  • Interest payments on debt are well covered by earnings (EBIT is 27.9x coverage).
X
Financial health checks
We assess Stelco Holdings's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Stelco Holdings has a total score of 5/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

Dividends

 What is Stelco Holdings's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
2.29%
Current annual income from Stelco Holdings dividends. Estimated to be 3.9% next year.
If you bought CA$2,000 of Stelco Holdings shares you are expected to receive CA$46 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Stelco Holdings's pays a higher dividend yield than the bottom 25% of dividend payers in Canada (2.09%).
  • Stelco Holdings's dividend is below the markets top 25% of dividend payers in Canada (5.67%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
TSX:STLC Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 6 Analyst Estimates (S&P Global) See Below
Canada Metals and Mining Industry Average Dividend Yield Market Cap Weighted Average of 28 Stocks 1.2%
Canada Market Average Dividend Yield Market Cap Weighted Average of 330 Stocks 3.5%
Canada Minimum Threshold Dividend Yield 10th Percentile 1.1%
Canada Bottom 25% Dividend Yield 25th Percentile 2.1%
Canada Top 25% Dividend Yield 75th Percentile 5.7%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

TSX:STLC Future Dividends Estimate Data
Date (Data in CA$) Dividend per Share (annual) Avg. No. Analysts
2022-12-31 0.40 1.00
2021-12-31 0.40 3.00
2020-12-31 0.40 4.00
2019-12-31 1.25 4.00
TSX:STLC Past Annualized Dividends Data
Date (Data in CA$) Dividend per share (annual) Avg. Yield (%)
2019-02-19 0.400 2.181
2018-07-31 0.400 2.076
2018-05-02 0.400 1.618
2018-02-22 0.400 1.695

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • It is too early to tell whether Stelco Holdings has stable dividend payments.
  • Stelco Holdings only just started paying a dividend, it is too early to tell if payments are increasing.
Current Payout to shareholders
What portion of Stelco Holdings's earnings are paid to the shareholders as a dividend.
  • Dividends paid are thoroughly covered by earnings (7.1x coverage).
Future Payout to shareholders
  • Dividends after 3 years are expected to be thoroughly covered by earnings (7.3x coverage).
X
Income/ dividend checks
We assess Stelco Holdings's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1.1%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Stelco Holdings afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Stelco Holdings has a total score of 3/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

Management

 What is the CEO of Stelco Holdings's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
David Cheney
COMPENSATION CA$1,039,756
AGE 42
TENURE AS CEO 0.1 years
CEO Bio

Mr. David Cheney has been Chief Executive Officer of Stelco Holdings Inc. (alternatively U. S. Steel Canada Inc. since February 20, 2019 and served as its Chief Business Development Officer since June 30, 2017. Mr. Cheney served as Chief Business Development Officer at Stelco Inc. since June 30, 2017 until February 20, 2019. He serves as Chief Executive Officer of Stelco Inc. since February 20, 2019. He serves as Chief Executive Officer of Steel Company of Canada, Limited since February 20, 2019 and served as its Chief Business Development Officer until February 20, 2019. He serves as the President of Bedrock. Mr. Cheney has also been with Bedrock since its formation in 2015. Mr. Cheney has extensive advisory, capital markets and restructuring expertise, with a focus on the metals and mining sector. Prior to joining Stelco, Mr. Cheney was an Investment Banker with roles at JP Morgan and Deutsche Bank. Mr. Cheney was responsible for the metals and mining practice at Wells Fargo Securities. Mr. Cheney served as Managing Director of Industrials Investment Banking Group at Wells Fargo Securities, LLC since July 2012. Mr. Cheney spent the first eight years of his investment banking career, beginning in 1998 at JPMorgan Securities, where he focused on advising and raising capital for clients in the Metals & Mining sector. After JPMorgan Securities, Mr. Cheney held various investment banking positions, including Vice President at Wachovia Capital Markets LLC, where he was part of the Global Industries group and focused on mining, metals, coal and construction materials. Mr. Cheney served as a Managing Director at Deutsche Bank Securities Inc., where he was responsible for its Metals & Mining franchise. Mr. Cheney has a Bachelor of Arts in International Affairs from Lafayette College.

CEO Compensation
  • Insufficient data for David to compare compensation growth.
  • David's remuneration is lower than average for companies of similar size in Canada.
Management Team Tenure

Average tenure and age of the Stelco Holdings management team in years:

1.6
Average Tenure
54.5
Average Age
  • The average tenure for the Stelco Holdings management team is less than 2 years, this suggests a new team.
Management Team

Alan Kestenbaum

TITLE
Executive Chairman
COMPENSATION
CA$3M
AGE
56

David Cheney

TITLE
Chief Executive Officer
COMPENSATION
CA$1M
AGE
42
TENURE
0.1 yrs

Don Newman

TITLE
Chief Financial Officer
COMPENSATION
CA$1M
AGE
53
TENURE
1.6 yrs

Sujit Sanyal

TITLE
Chief Operating Officer
COMPENSATION
CA$767K
AGE
62
TENURE
1.5 yrs

Paul Simon

TITLE
General Counsel & Corporate Secretary
AGE
41
TENURE
1.6 yrs

Bill Aziz

TITLE
Chief Restructuring Officer
AGE
62
TENURE
4.5 yrs

Jack Dicosimo

TITLE
Vice President of Operations
COMPENSATION
CA$235K
Board of Directors Tenure

Average tenure and age of the Stelco Holdings board of directors in years:

1.5
Average Tenure
62.5
Average Age
  • The average tenure for the Stelco Holdings board of directors is less than 3 years, this suggests a new board.
Board of Directors

Alan Kestenbaum

TITLE
Executive Chairman
COMPENSATION
CA$3M
AGE
56
TENURE
1.5 yrs

Brian Levitt

TITLE
Lead Director
COMPENSATION
CA$67K
AGE
70

Peter Bowie

TITLE
Independent Director
COMPENSATION
CA$54K
AGE
71
TENURE
1.5 yrs

Michael Dees

TITLE
Director
AGE
44
TENURE
1.5 yrs

Jeffrey Bunder

TITLE
Director
AGE
53
TENURE
1.5 yrs

Alan Goldberg

TITLE
Director
AGE
63
TENURE
1 yrs

Jack Lew

TITLE
Director
AGE
62
TENURE
0.8 yrs

Indira Samarasekera

TITLE
Director
AGE
65
TENURE
0.8 yrs
Who owns this company?
Recent Insider Trading
  • No 3 month insider trading information.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price (CA$) Value (CA$)
15. Mar 19 Buy TruShield Insurance Services Ltd Company 12. Mar 19 14. Mar 19 23,900 CA$17.74 CA$417,314
15. Mar 19 Buy Fairfax Financial Holdings Limited Company 12. Mar 19 14. Mar 19 43,100 CA$17.74 CA$752,511
12. Mar 19 Buy Fairfax Financial Holdings Limited Company 08. Mar 19 08. Mar 19 6,500 CA$18.00 CA$116,975
22. Feb 19 Buy TruShield Insurance Services Ltd Company 20. Feb 19 21. Feb 19 19,600 CA$17.96 CA$350,829
22. Feb 19 Buy Fairfax Financial Holdings Limited Company 20. Feb 19 21. Feb 19 38,900 CA$17.96 CA$696,270
05. Feb 19 Buy TruShield Insurance Services Ltd Company 04. Feb 19 04. Feb 19 4,000 CA$17.49 CA$69,964
05. Feb 19 Buy Fairfax Financial Holdings Limited Company 04. Feb 19 04. Feb 19 4,000 CA$17.49 CA$69,964
04. Feb 19 Buy TruShield Insurance Services Ltd Company 29. Jan 19 01. Feb 19 110,200 CA$17.37 CA$1,899,335
04. Feb 19 Buy Fairfax Financial Holdings Limited Company 29. Jan 19 01. Feb 19 208,900 CA$17.37 CA$3,602,274
28. Jan 19 Buy TruShield Insurance Services Ltd Company 21. Jan 19 23. Jan 19 106,200 CA$15.97 CA$1,689,231
28. Jan 19 Buy Fairfax Financial Holdings Limited Company 21. Jan 19 23. Jan 19 204,900 CA$15.97 CA$3,259,141
17. Jan 19 Buy Paul Rivett Individual 17. Dec 18 17. Dec 18 1,000 CA$15.90 CA$15,900
17. Jan 19 Buy Fairfax Financial Holdings Limited Company 16. Jan 19 16. Jan 19 23,800 CA$15.14 CA$360,384
19. Nov 18 Sell Bedrock Industries B.V. Company 19. Nov 18 19. Nov 18 -12,200,000 CA$20.50 CA$-250,099,992
24. Sep 18 Sell David Cheney Individual 18. Sep 18 18. Sep 18 -249,693 CA$22.65 CA$-5,655,546
24. Sep 18 Sell Alan Goldberg Individual 18. Sep 18 18. Sep 18 -7,750,307 CA$22.65 CA$-175,544,454
15. Aug 18 Buy Adolfo Montiel Individual 10. Aug 18 10. Aug 18 1,500 CA$24.22 CA$36,330
07. Apr 18 Sell Bedrock Industries B.V. Company 03. Apr 18 03. Apr 18 -10,000,000 CA$21.75 CA$-217,500,001
X
Management checks
We assess Stelco Holdings's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Stelco Holdings has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

News

Simply Wall St News

How Does Stelco Holdings Inc (TSE:STLC) Fare As A Dividend Stock?

Stelco Holdings Inc (TSE:STLC) has returned an average dividend yield of 2.00% annually to shareholders. … Let's dig deeper into whether Stelco Holdings should have a place in your portfolio. … When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:

Simply Wall St -

Is Stelco Holdings Inc's (TSE:STLC) PE Ratio A Signal To Sell For Investors?

But can investors make a closing judgement of the company’s value based on this low multiple. … The answer is no, since important variables like the company’s potential to grow and debt levels are ignored in the PE’s calculation … To resolve this problem, I’ll identify some important factors to consider when judging the relative valuation of

Simply Wall St -

What’s Ahead For Stelco Holdings Inc (TSE:STLC)?

Below, I will examine the sector growth prospects, and also determine whether Stelco Holdings is a laggard or leader relative to its basic materials sector peers. … As an industry laggard, Stelco Holdings may be a cheaper stock relative to its peers. … Next Steps: Stelco Holdings is a metals and mining industry laggard in terms of its future growth outlook.

Simply Wall St -

Calculating The Intrinsic Value Of Stelco Holdings Inc (TSE:STLC)

5-year cash flow forecast 2018 2019 2020 2021 2022 Levered FCF (CA$, Millions) CA$329.33 CA$267.25 CA$354.00 CA$471.00 CA$458.41 Source Analyst x3 Analyst x4 Analyst x1 Analyst x1 Extrapolated @ (-2.67%) Present Value Discounted @ 17.73% CA$279.74 CA$192.83 CA$216.96 CA$245.20 CA$202.71 Present Value of 5-year Cash Flow (PVCF)= CA$1,137 After calculating the present value of future cash flows in the intial 5-year period we need to calculate the Terminal Value, which accounts for all the future cash flows beyond the first stage. … Terminal Value (TV) = FCF2022 × (1 + g) ÷ (r – g) = CA$458 × (1 + 2.1%) ÷ (17.7% – 2.1%) = CA$3,002 Present Value of Terminal Value (PVTV) = TV / (1 + r)5 = CA$3,002 / ( 1 + 17.7%)5 = CA$1,327 The total value, or equity value, is then the sum of the present value of the cash flows, which in this case is CA$2,465. … TSX:STLC Intrinsic Value May 17th 18 Important assumptions I'd like to point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows.

Simply Wall St -

Does Stelco Holdings Inc's (TSE:STLC) Past Performance Indicate A Stronger Future?

Measuring Stelco Holdings Inc's (TSX:STLC) track record of past performance is a useful exercise for investors. … Check out our latest analysis for Stelco Holdings How STLC fared against its long-term earnings performance and its industry I use data from the most recent 12 months, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. … Since these values may be somewhat short-term thinking, I have computed an annualized five-year value for Stelco Holdings's earnings, which stands at CA$2.09B This means that, generally, Stelco Holdings has been able to gradually raise its bottom line over the past couple of years as well.

Simply Wall St -

How Financially Strong Is Stelco Holdings Inc (TSE:STLC)?

Over the past year, STLC has reduced its debt from CA$1.82B to CA$121.00M , which is made up of current and long term debt. … With this debt repayment, STLC currently has CA$250.00M remaining in cash and short-term investments for investing into the business. … For STLC, the ratio of 1x suggests that interest is not strongly covered, which means that debtors may be less inclined to loan the company more money, reducing its headroom for growth through debt.Next Steps: STLC’s cash flow coverage indicates it could improve its operating efficiency in order to meet demand for debt repayments should unforeseen events arise.

Simply Wall St -

What Do Analysts Think About Stelco Holdings Inc's (TSE:STLC) Future?

Since Stelco Holdings Inc (TSX:STLC) released its earnings in December 2017, it seems that analyst forecasts are fairly bearish, with profits predicted to drop by -94.88% next year compared with the past 5-year average growth rate of 82.37%. … To understand the overall trajectory of STLC's earnings growth over these next fews years, I've fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope. … TSX:STLC Future Profit Mar 19th 18 By 2021, STLC's earnings should reach CA$275.11M, from current levels of CA$5.37B, resulting in an annual growth rate of -70.20%.

Simply Wall St -

Does Stelco Holdings Inc's (TSE:STLC) PE Ratio Warrant A Buy?

Formula Price-Earnings Ratio = Price per share ÷ Earnings per share P/E Calculation for STLC Price per share = CA$26.79 Earnings per share = CA$67.895 ∴ Price-Earnings Ratio = CA$26.79 ÷ CA$67.895 = 0.4x On its own, the P/E ratio doesn’t tell you much; however, it becomes extremely useful when you compare it with other similar companies. … For example, if you inadvertently compared lower risk firms with STLC, then investors would naturally value STLC at a lower price since it is a riskier investment. … Similarly, if you accidentally compared higher growth firms with STLC, investors would also value STLC at a lower price since it is a lower growth investment.

Simply Wall St -

Breaking Down Stelco Holdings Inc's (TSE:STLC) Ownership Structure

General Public Ownership The general public holds a substantial 15.08% stake in STLC, making it a highly popular stock among retail investors. … With this size of ownership, retail investors can collectively play a role in major company policies that affect shareholders returns, including executive remuneration and the appointment of directors. … Private Company Ownership Potential investors in STLC should also look at another important group of investors: private companies, with a stake of 84.77%, who are primarily invested because of strategic and capital gain interests.

Simply Wall St -

A Look At Stelco Holdings Inc (TSE:STLC) And The Basic Materials Sector

Stelco Holdings Inc (TSX:STLC), a CADCA$2.01B mid-cap, is a metals and mining operating in an industry which supplies materials for construction. … Furthermore, the basic materials sector can be affected by shifts in the housing market, as many produced raw materials are components of construction projects. … In this article, I’ll take you through the sector growth expectations, and also determine whether Stelco Holdings is a laggard or leader relative to its basic materials sector peers.

Simply Wall St -

Company Info

Description

Stelco Holdings Inc. produces and sells various steel products in Canada and the United States. The company provides flat-rolled value-added steel, including coated, pre-painted, cold-rolled, and hot-rolled steel products, as well as metallurgical coke. It sells its products to customers in the steel service center, appliance, automotive, energy, construction, and pipe and tube industries. The company was founded in 1910 and is headquartered in Hamilton, Canada.

Details
Name: Stelco Holdings Inc.
STLC
Exchange: TSX
Founded: 1910
CA$1,551,473,006
88,757,037
Website: http://www.stelco.com
Address: Stelco Holdings Inc.
386 Wilcox Street,
Hamilton,
Ontario, L8L 8K5,
Canada
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
TSX STLC New Common Shares The Toronto Stock Exchange CA CAD 03. Nov 2017
OTCPK STZH.F New Common Shares Pink Sheets LLC US USD 03. Nov 2017
DB S0K New Common Shares Deutsche Boerse AG DE EUR 03. Nov 2017
Number of employees
Current staff
Staff numbers
2,266
Stelco Holdings employees.
Industry
Steel
Materials
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/03/20 00:45
End of day share price update: 2019/03/19 00:00
Last estimates confirmation: 2019/03/07
Last earnings filing: 2019/02/19
Last earnings reported: 2018/12/31
Last annual earnings reported: 2018/12/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.