Vale S.A. (VALE)
Valuation Overview•Is Vale S.A. Overvalued or Undervalued?
Trading at a discount across both intrinsic cash flow and relative peer multiples, indicating a strong margin of safety.
Moderate quality score of 52/100, reflecting stable operating margins and manageable leverage.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: Average quality business weighed down by significant growth concerns.
Wall Street is highly bullish, projecting significant upside alongside robust expected earnings growth. This outlook is strongly supported by highly attractive capital returns, anchored by a strong dividend yield, though free cash flow coverage appears tight.
VALE demonstrates adequate business quality with stable profitability. This is paired with a moderately leveraged but stable balance sheet.
The company is facing top-line contraction (-4.5% 3Y CAGR) however, earnings have severely contracted over the same period. This growth is supported by elite operational efficiency, sustaining an impressive 27.8% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $9.3B | +0.5% | -4.5% | -0.7% | +4.1% | |
| EBITDA | $3.5B | — | -11.5% | — | — | |
| Net Income | $1.9B | -59.9% | -49.1% | — | — | |
| EPS (Diluted) | $0.44 | -57.7% | -47.7% | -10.5% | — | |
| Free Cash Flow | $699.9M | +6.1% | -20.3% | -21.2% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 34.5% | 37.7% | 43.7% | 43.4% |
| Operating Margin | 27.8% | 30.4% | 36.3% | 31.5% |
| Net Margin | 7.1% | 13.9% | 25.2% | 18.3% |
| FCF Margin | 8.5% | 11.1% | 17.0% | 19.0% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $0.47 | $0.44 | -6.4% | ||
| Q1'26 | $0.57 | $-0.90 | -257.9% | ||
| Q4'25 | $0.49 | $0.63 | +28.6% | ||
| Q3'25 | $0.34 | $0.50 | +47.1% | ||
| Q2'25 | $0.37 | $0.35 | -5.4% | ||
| Q1'25 | $0.56 | $0.20 | -64.3% | ||
| Q4'24 | $0.46 | $0.56 | +21.7% | ||
| Q3'24 | $0.38 | $0.43 | +13.2% |
Total return is +76.7% (1Y), outperforming the benchmark by +51.7%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +16.3% | +7.0% | — |
| 1Y | +76.7% | +51.7% | +10.9% |
| 3YCAGR | +10.0% | -9.3% | +23.4% |
| 5YCAGR | +0.9% | -11.0% | +33.0% |
| 10YCAGR | +18.4% | +5.3% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Vale S.A. (VALE) valuation, health, and returns.
Vale S.A. is estimated to be undervalued under our discounted cash flow framework. relative multiples indicate the stock is Cheap versus peers compared to industry peers. undervalued (implying +54.0% upside to DCF intrinsic value of $23.75)
Vale S.A. has multiple valuation anchors: DCF Intrinsic Value: $23.75 | Peer Relative Fair Value: $36.52 | Wall Street Analyst Target: $17.79 (implying +15.4% upside). A convergence of these signals offers higher conviction.
Vale S.A. displays fair financial health with a composite quality score of 52/100, supported by a Altman Z-Score of 1.2 (distress zone), Piotroski F-Score of 4/9, Return on Invested Capital (ROIC) of 17.7%.
Vale S.A. pays a 5.4% dividend yield, covered by a 145% payout ratio with 2 years of growth, supplemented by a 0.0% buyback yield.
Vale S.A.'s current growth trajectory is Accelerating. The company achieved +0.5% 1Y revenue growth and -57.7% 1Y EPS growth, compared to its 3Y revenue CAGR of -4.5%.
Wall Street consensus is Hold based on 37 analysts, beating EPS expectations in 42% of recent quarters with a -2-quarter streak. The consensus price target represents a +15.4% change from current levels.
Investment risks for Vale S.A. include: -19.9% 1-year max drawdown, elevated distress risk, stretched payout ratio. Volatility risk is characterized by a beta of 1.20x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.