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Research Alert: CFRA Lowers Opinion On Adss Of Vale S.a. To Sell From Hold
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Research Alert: CFRA Lowers Opinion On Adss Of Vale S.a. To Sell From Hold
Jul 25, 2025 10:49 PM

10:55 AM EDT, 07/24/2025 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We decrease our 12-month target by $1.50 to $8.50, on an EV/EBITDA of 3.7x our 2026 EBITDA estimate, in line with VALE's three-year avg. forward EV/EBITDA and a discount to peers' avg. forward EV/EBITDA of 5.2x. We lower our 2025 earnings per ADS by BRL0.89 to BRL11.29 and our 2026 forecast by BRL0.36 to BRL10.79. We think pricing will remain challenging with iron ore fines realizing $85.10/t in Q2 (-13.3% y/y), reflecting weaker Chinese steel demand and broader economic concerns. Vale cut its iron ore agglomerates guidance by 18% at the midpoint, as the pellet market struggles with oversupply. Despite aggressive cost management and a disciplined approach to capital returns, Vale remains highly exposed to a softening global industrial cycle, particularly in China, where real estate and infrastructure investment continues to underperform. Recent production guidance cuts and falling pellet premiums further underscore a weakening operating backdrop, while a lack of near-term catalysts limits upside potential.

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