Grupo Simec SA De CV (SIM) AI Stock Analysis

• Market Cap: $4.71B
• Dividend Yield: N/A
• Average Volume (3M): 1.17K
• Price to Earnings (P/E): 13.2
• Beta (1Y): 0.33
• Revenue Growth: -18.58%
• EPS Growth: -35.32%
• Country: US
• Employees: 4,565
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Steel
• EPS (TTM): -0.33
• Shares Outstanding: 165,903,080
• 10 Day Avg. Volume: 370
• 30 Day Avg. Volume: 1,173
• PEG Ratio: 0.03
• Price to Book (P/B): 0.53
• Price to Sales (P/S): 0.93
• P/FCF Ratio: 9.16
• Enterprise Value/Market Cap: 0.57
• Enterprise Value/Revenue: 0.08
• Enterprise Value/Gross Profit: 0.34
• Enterprise Value/Ebitda: 0.39
• 1Y Price Target: $30.00
• Price Target Upside: 7.95% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 64 Neutral
• Price Target: $30.00 ▲(7.95% Upside)

Grupo Simec SA De CV's overall stock score is driven by its strong financial performance, particularly in profitability and balance sheet stability. However, technical indicators suggest potential bearish momentum, and cash flow challenges pose risks to future financial flexibility. The valuation is reasonable, but the lack of a dividend yield may deter some investors.

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, which include rebar, wire rod, and flat steel products. The company serves a diverse range of industries, including construction, automotive, and machinery manufacturing, allowing it to tap into multiple revenue streams. Additionally, Grupo Simec benefits from strategic partnerships with suppliers and distributors, enhancing its market reach and operational efficiency. Key factors contributing to its earnings include fluctuations in steel prices, demand from construction and infrastructure projects, and operational efficiencies achieved through advanced manufacturing technologies.

Grupo Simec SA De CV Financial Statement Overview

Summary

Grupo Simec SA De CV demonstrates strong financial health with high profitability margins and a solid balance sheet characterized by minimal leverage. However, the company faces challenges with declining revenue and inconsistent cash flow growth, which could impact long-term sustainability.

Income Statement

Grupo Simec SA De CV has demonstrated stable profitability with a healthy gross profit margin of 24.4% TTM. The net profit margin is exceptionally strong at 33.7% TTM, indicating effective cost management and operational efficiency. However, the revenue has shown a downward trend, with a notable decline of approximately 20% from 2021 to 2023, which could be a concern if it continues.

Balance Sheet

The company's balance sheet is robust, featuring a very low debt-to-equity ratio of 0.0001 TTM, highlighting minimal leverage and substantial equity support. The equity ratio stands high at 83.2%, indicating strong financial stability and asset backing. The return on equity is impressive at 18.3%, showing effective utilization of shareholder funds.

Cash Flow

The cash flow statement presents a mixed picture with consistent free cash flow generation. The operating cash flow to net income ratio is 0.49 TTM, suggesting moderate cash conversion efficiency. Free cash flow to net income is at a reasonable level of 0.30 TTM, though the free cash flow growth rate has been uneven, reflecting potential volatility in cash flow generation.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	32.21B	33.66B	41.22B	54.16B	55.62B	35.87B
Gross Profit	7.81B	8.19B	10.63B	14.48B	15.65B	6.66B
EBITDA	6.92B	13.50B	7.67B	13.21B	14.77B	6.64B
Net Income	6.34B	11.48B	5.19B	7.86B	9.44B	2.80B
Balance Sheet
Total Assets	71.30B	74.81B	66.79B	67.63B	57.34B	47.58B
Cash, Cash Equivalents and Short-Term Investments	27.50B	29.16B	23.58B	21.55B	15.13B	7.73B
Total Debt	5.69M	6.19M	5.10M	5.85M	6.20M	6.02M
Total Liabilities	11.64B	15.61B	16.98B	19.64B	15.38B	14.40B
Stockholders Equity	59.63B	59.17B	49.78B	47.96B	41.92B	33.15B
Cash Flow
Free Cash Flow	-2.70B	3.42B	1.77B	7.09B	7.32B	2.68B
Operating Cash Flow	75.13M	5.54B	4.26B	8.79B	8.39B	3.63B
Investing Cash Flow	-492.02M	-270.47M	-1.28B	-4.14B	-1.01B	-832.67M
Financing Cash Flow	-413.77M	-130.22M	-242.77M	2.23B	-161.94M	-2.09B

Grupo Simec SA De CV Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 27.79
• 50DMA: Negative
• 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 Negative. The current price of 27.79 is below the 20-day moving average (MA) of 28.14, below the 50-day MA of 28.07, and above the 200-day MA of 26.96, indicating a neutral trend. The MACD of -0.08 indicates Positive momentum. The RSI at 47.82 is Neutral, neither overbought nor oversold. The STOCH value of 51.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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
CMC	71 Outperform	$5.93B	170.87	0.88%	1.36%	-5.64%	-93.26%
Sector *	70 Outperform	¥179.59B	11.19	5.69%	3.10%	2.78%	-8.64%
TX	70 Neutral	$6.23B	10.66	4.89%	8.50%	-16.83%	―
GGB	66 Neutral	$5.83B	10.66	5.77%	3.59%	-6.55%	-37.93%
SIM	64 Neutral	$4.71B	13.23	10.49%	―	-18.58%	-35.32%
CLF	57 Neutral	$4.73B	―	-25.79%	―	-12.14%	-4329.00%
SID	47 Neutral	$1.76B	―	-15.57%	16.75%	-10.77%	-191.87%