Grupo Simec SA De CV (SIM) AI Stock Analysis

• Market Cap: $5.27B
• Dividend Yield: N/A
• Average Volume (3M): 445.00
• Price to Earnings (P/E): 62.0
• Beta (1Y): 0.29
• Revenue Growth: -16.81%
• EPS Growth: -67.68%
• Country: US
• Employees: 4,565
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Steel
• EPS (TTM): 0.25
• Shares Outstanding: 165,903,080
• 10 Day Avg. Volume: 588
• 30 Day Avg. Volume: 445
• PEG Ratio: -0.70
• Price to Book (P/B): 1.49
• Price to Sales (P/S): 3.12
• P/FCF Ratio: -75.71
• Enterprise Value/Market Cap: 10.65
• Enterprise Value/Revenue: 1.86
• Enterprise Value/Gross Profit: 7.38
• Enterprise Value/Ebitda: 13.90
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 69 Neutral
• Price Target: $36.00 ▲(19.60% Upside)
• Action: Downgraded Date: 02/24/26
• Date: Action: Downgraded 02/24/26

The score is driven by strong solvency but weakening cash generation and softer recent earnings, which temper the financial outlook. Technicals are constructive with an uptrend and positive momentum, while valuation is a headwind given the ~26.95 P/E and no dividend yield data.

Positive Factors

Very strong balance sheet / low leverage

Negligible debt and a conservative balance sheet provide durable financial flexibility. This structural solvency lets Simec fund cyclical working capital swings, sustain operations during steel cycles, and pursue strategic investments without material refinancing risk over the next 2–6 months.

Operational margin resilience

Despite falling volumes and average prices, gross margin improvement and flat-to-rising operating metrics show structural cost flexibility and operating leverage. That resilience indicates the business can protect profitability across moderate price cycles and sustain core earnings longer term.

Diversified product mix and export channels

A broad product portfolio and multi‑industry customer base plus export activity reduce dependence on any single market. This structural diversification supports steadier demand and revenue sources over time, cushioning the company against localized slowdowns.

Negative Factors

Sustained revenue contraction

Multi‑year revenue decline undermines scale advantages and long‑term growth prospects. Persistent top‑line weakness compresses operating leverage, limits reinvestment capacity, and raises the risk that profits remain volatile absent a durable recovery in volumes or pricing.

Weakening cash generation / negative FCF

A shift to negative free cash flow in 2025 creates structural funding pressure despite low debt. Reduced cash conversion constrains the firm’s ability to self‑fund capex, manage working capital, or return capital, increasing reliance on external financing if the trend persists.

Earnings volatility from FX and financial costs

Significant swings in financial income tied to FX create structural earnings volatility: even stable operating results were swamped by currency and financial cost swings. This exposure increases predictability risk for shareholders and complicates long‑term planning and dividend capacity.

Grupo Simec SA De CV Business Overview & Revenue Model

Company Description

Grupo Simec, S.A.B. de C.V. manufactures, processes, and distributes special bar quality (SBQ) steel and steel alloys products in Mexico, the United States, Brazil, Canada, Latin America, and internationally. The company produces I-beams, channels, structural and commercial angles, hot rolled bars, flat bars, rebars, cold finished bars, electro-welded wire mesh and mesh panels, and wire rods, as well as semi-finished tube rounds and other semi-finished trade products. Its SBQ steel products are used across a range of engineered end-user applications, including axles, hubs, and crankshafts for automobiles and light trucks, machine tools, and off-highway equipment; and structural steel products are used in the non-residential construction market and other construction applications. The company also exports its steel products to Central and South America, and Europe. The company was founded in 1934 and is headquartered in Guadalajara, Mexico. Grupo Simec, S.A.B. de C.V. is a subsidiary of Industrias CH, S.A.B. de C.V.

How the Company Makes Money

Grupo Simec generates revenue primarily through the sale of its steel products to a wide range of customers in different industries. The company’s key revenue streams include the production and sale of long steel products such as rebar, wire rod, and structural steel, which are used in construction and manufacturing. Additionally, Grupo Simec benefits from partnerships with construction firms and industrial manufacturers, ensuring a steady demand for its products. The company also engages in export activities, supplying steel to international markets, which further contributes to its earnings. Fluctuations in global steel prices and demand in construction and industrial sectors significantly impact its revenue.

Grupo Simec SA De CV Financial Statement Overview

Summary

Exceptionally strong balance sheet (very low leverage) supports resilience, but income performance is cooling with revenue contraction and a sharp net income step-down in 2025. Cash flow is a key drag as operating cash flow fell and free cash flow turned negative in 2025, increasing near-term uncertainty despite strong solvency.

Income Statement

Revenue has been contracting for several years (down again in 2025 vs. 2024), and profitability has cooled meaningfully versus the 2021–2024 period. Even so, the company remains solidly profitable with strong operating earnings in 2025 and a healthy gross profit base. The key weakness is the sharp step-down in net income in 2025 compared with 2024, which signals higher volatility in earnings power typical of a cyclical steel business.

Balance Sheet

The balance sheet is exceptionally conservative: debt is negligible relative to equity and assets across the years provided, indicating very low financial leverage and strong solvency. Equity is large and has generally grown versus earlier periods, supporting resilience through industry cycles. The main limitation is that balance-sheet strength doesn’t prevent earnings swings, and returns on equity can fluctuate materially year to year.

Cash Flow

Cash generation weakened in 2025: operating cash flow fell sharply from 2024 and free cash flow turned negative, reflecting heavier cash outflows (likely working capital and/or investment needs). While prior years show the business can produce strong positive free cash flow (notably 2022–2024), the latest period introduces near-term uncertainty around cash conversion and funding of capital needs, despite the benefit of very low leverage.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	28.41B	33.66B	41.22B	54.16B	55.62B
Gross Profit	7.16B	7.62B	10.63B	14.48B	15.65B
EBITDA	5.55B	13.61B	7.67B	12.33B	15.10B
Net Income	1.44B	10.49B	5.19B	7.86B	9.44B
Balance Sheet
Total Assets	71.60B	74.81B	66.79B	67.63B	2.82B
Cash, Cash Equivalents and Short-Term Investments	28.59B	29.16B	23.58B	21.55B	739.32M
Total Debt	5.43M	6.19M	5.10M	5.85M	302.76K
Total Liabilities	12.12B	15.61B	16.98B	19.64B	765.96M
Stockholders Equity	59.46B	59.17B	49.78B	47.96B	2.05B
Cash Flow
Free Cash Flow	-1.17B	3.42B	1.77B	7.25B	7.32B
Operating Cash Flow	1.62B	5.55B	4.26B	8.95B	8.39B
Investing Cash Flow	-2.09B	-277.77M	-1.28B	-4.14B	-1.01B
Financing Cash Flow	-108.59M	-130.23M	-242.77M	2.23B	-161.94M

Grupo Simec SA De CV Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 30.10
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SIM, the sentiment is Neutral. The current price of 30.1 is below the 20-day moving average (MA) of 31.38, below the 50-day MA of 30.31, and above the 200-day MA of 28.62, indicating a neutral trend. The MACD of 0.43 indicates Positive momentum. The RSI at 48.19 is Neutral, neither overbought nor oversold. The STOCH value of 41.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SIM.

Grupo Simec SA De CV Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SIM	69 Neutral	$5.27B	61.97	5.84%	―	-16.81%	-67.68%
CMC	67 Neutral	$8.22B	19.11	10.51%	1.02%	-1.61%	-81.36%
TX	65 Neutral	$8.42B	19.76	3.49%	7.02%	-16.69%	585.38%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
GGB	61 Neutral	$7.76B	32.85	2.47%	2.92%	-2.53%	-36.08%
SID	53 Neutral	$2.19B	-8.39	-10.50%	―	-5.79%	-5.30%
CLF	49 Neutral	$6.04B	-3.69	-22.96%	―	-6.76%	-255.94%

Grupo Simec SA De CV Corporate Events

Grupo Simec Posts Flat EBITDA but 85% Profit Drop on FX Hit in 2025 Results

Grupo Simec reported audited results for the twelve months ended December 31, 2025, showing a 10% drop in net sales to Ps. 30,291 million as shipments of finished steel fell 6% and average prices declined 4% versus 2024, with sales down 14% abroad and 7% in Mexico. Despite lower revenue, cost of sales fell 13% on cheaper scrap, keeping gross profit roughly flat at Ps. 7,634 million and lifting gross margin to 25%.

Selling, general and administrative expenses rose 8% and other net income improved, helping operating income edge up 1% to Ps. 5,365 million and operating margin to 18%. However, a swing from a Ps. 7,240 million comprehensive financial income in 2024 to a Ps. 2,494 million financial cost in 2025, driven mainly by a shift from a Ps. 5,556 million exchange gain to a Ps. 3,602 million exchange loss, caused net income to plunge 85% to Ps. 1,533 million.

EBITDA increased 1% year on year to Ps. 6,446 million, indicating underlying operating resilience despite weaker volumes and pricing and a much less favorable financial environment. As of December 31, 2025, Simec’s consolidated debt remained minimal, limited to legacy medium-term notes, while quarterly trends improved, with fourth-quarter 2025 net sales up 7% from the third quarter on higher tonnage and stronger demand both in Mexico and abroad.

The most recent analyst rating on (SIM) stock is a Buy with a $34.00 price target. To see the full list of analyst forecasts on Grupo Simec SA De CV stock, see the SIM Stock Forecast page.