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Usinas Siderurgicas de Minas (USNZY)
OTHER OTC:USNZY
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Usiminas
(OTC:USNZY)
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Rating:57Neutral
Price Target:
$1.50
▲(20.00% Upside)
Action:ReiteratedDate:02/18/26
The score is held back primarily by weakened financial performance (recent losses and declining profitability), despite improved 2025 cash flow and a relatively sound balance sheet. Technicals are modestly supportive with the stock above key moving averages, while valuation is constrained by negative earnings and no near-term dividend. Earnings-call commentary improves the outlook somewhat via stable volume guidance, expected pricing/mix recovery, and net cash, but meaningful import and cost risks remain.
Positive Factors
Mining segment growth and diversification
Strong, record mining volumes and large year-over-year mining EBITDA growth signal a durable diversification away from sole reliance on flat steel. Mining revenue and EBITDA expansion provide a structural earnings cushion versus steel-cycle swings and improve overall business resilience.
Improved cash generation and net cash position
Material positive free cash flow and an end‑year net cash position boost financial flexibility. Sustained cash generation funds CapEx, deleveraging and working capital needs, lowering refinancing risk and enabling investment in competitiveness over the medium term.
Operational efficiencies and targeted CapEx
Demonstrable per‑ton cost reductions and efficiency projects (PCI, coke battery work) are structural levers to restore margins. Combined with planned CapEx to secure coke self‑sufficiency, these investments improve long‑run unit economics and emissions compliance.
Negative Factors
Sharp profitability deterioration and recent losses
The swing to sustained net losses and a negative margin erodes long‑term return generation and shareholder equity. Persistent below‑the‑line weakness undermines reinvestment capacity and makes margin recovery and consistent capital returns more challenging if not reversed.
Ongoing import competition and circumvention risk
Structural pressure from cheap imports and possible circumvention weakens domestic pricing power and volume recovery. Even with interim tariffs, persistent triangulation risk can prolong margin compression and limit the effectiveness of local capacity utilization improvements.
Shrinking equity and volatile financial metrics
Declining equity and negative ROE reflect erosion of the capital base from losses, increasing vulnerability to future shocks. Reduced equity limits strategic flexibility, may constrain financing options, and raises the bar for sustained profitability to restore shareholder value.
Usiminas (USNZY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.65B
Dividend YieldN/A
Average Volume (3M)1.63K
Price to Earnings (P/E)―
Beta (1Y)0.60
Revenue Growth-8.05%
EPS Growth-435.96%
CountryUS
Employees51,182
SectorBasic Materials
Sector Strength58
IndustrySteel
Share Statistics
EPS (TTM)0.01
Shares Outstanding547,752,000
10 Day Avg. Volume854
30 Day Avg. Volume1,625
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)0.34
Price to Sales (P/S)0.27
P/FCF Ratio5.65
Enterprise Value/Market Cap5.85
Enterprise Value/Revenue0.37
Enterprise Value/Gross Profit4.51
Enterprise Value/Ebitda29.43
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)0.1
Revenue Forecast (FY)$4.93B
Usiminas Business Overview & Revenue Model
Company DescriptionUsinas Siderúrgicas de Minas Gerais S.A. manufactures and markets flat steel products in Brazil and internationally. The company operates through four segments: Mining and Logistics, Steel Metallurgy, Steel Transformation, and Capital Assets. It extracts and process iron ore, such as pellet and sinter feed and, granulated iron ore; develops steel product solutions; and operates as a distribution center and trading company. The company manufactures and installs equipment for various industries; and engages in the provision of services related to road cargo transportation. It also offers stamped steel parts for the automobile industry; and products for the construction and capital goods industry, as well as engages in logistics business and produces hot-rolled galvanized steel sheets and coils. In addition, the company provides technology transfer services for steel industry; project management and services for civil construction and capital goods industry; road transportation of flat steel; hot-dip galvanizing services; and texturing and chrome plating of cylinders. Usinas Siderúrgicas de Minas Gerais S.A. was founded in 1950 and is headquartered in Belo Horizonte, Brazil.
How the Company Makes MoneyUsiminas generates revenue primarily through the sale of flat steel products, which include hot-rolled, cold-rolled, and coated steel sheets. The company's revenue model is supported by its diverse customer base, which spans several industries such as automotive, construction, and manufacturing. Key revenue streams include direct sales to large industrial clients and distributors, as well as exports to international markets. Additionally, Usiminas benefits from strategic partnerships with other companies in the steel supply chain, which enhance its market reach and operational efficiency. The company also engages in mining activities, producing iron ore, which contributes to its raw material supply and profitability. Factors such as global steel demand, pricing fluctuations, and operational efficiency play a significant role in influencing Usiminas's earnings.
Usiminas Earnings Call Summary
Earnings Call Date:Feb 13, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 24, 2026
Earnings Call Sentiment Neutral
The call presents a mixed but broadly stable outlook: material operational and financial improvements (EBITDA growth, record mining sales, strong free cash flow, net cash position, and continued CapEx for competitiveness and emissions reduction) are counterbalanced by persistent headwinds from unfair imports, pressured prices/mix, short-term seasonality in mining volumes and potential cost pressure from rising coal prices. Progress on trade remedies and internal efficiency projects support a path to margin recovery, but significant near-term risks and uncertainty on demand and import circumvention keep the tone cautious.Q4-2025 Updates
Positive Updates
Adjusted Consolidated EBITDA Growth
Adjusted consolidated EBITDA of BRL 2.0 billion for 2025, a 24% increase year-over-year, with an EBITDA margin of 8%.
Mining Record Sales
Mining unit achieved a record sales volume of 9.6 million tons in 2025, up 14% vs 2024; annual mining net revenue increased ~27% year-over-year and mining adjusted EBITDA rose ~46%.
Strong Free Cash Flow and Net Cash Position
Free cash flow for the year of approximately BRL 989 million (quarter FCF BRL 744 million); net debt fell by roughly BRL 1.4 billion over the year, ending with net cash of BRL 444 million and a negative leverage of 0.22x.
Steel Sales and Export Performance
Steel sales totaled 4.4 million tons for the year (second highest in 10 years) with growth in exports and stable annual domestic steel volumes.
Cost Improvements and Operational Efficiencies
Steel unit achieved a reduction in cost-to-sale per ton of about 5%, driven by efficiency initiatives (including PCI coal injection and other industrial improvements) which helped offset lower net revenue per ton.
CapEx Programs and Environmental/Capacity Enhancements
CapEx of ~BRL 1.2 billion in 2025 (within guidance BRL 1.2–1.4 billion); ongoing priority projects for 2026 include PCI plant completion, coke battery repairs and Coke Battery #4 (BRL 1.7 billion) to secure coke self-sufficiency and improved emissions (record low emissions reported). 2026 CapEx guidance around BRL 1.6 billion aligned to competitiveness goals.
Government Trade Remedies Progress
Brazilian authorities published antidumping measures (tariff increases ~9%) for certain products; company expects further definitive measures mid-2026 that could reduce unfair import pressure and create local sales opportunities (imports of flat steel were ~4 million tons in 2025, 60–65% from China).
Negative Updates
Pressure on Prices and Net Revenue per Ton
Net revenue per ton declined ~4%; deterioration in net revenue per ton reduced steel unit EBITDA by ~26% quarter-on-quarter and adjusted steel EBITDA was negatively impacted by a less favorable sales mix (shift to lower-margin products).
Quarterly Volume and Domestic Market Softness
Q4 sales volume declined ~2% quarter-on-quarter and domestic market sales fell ~3.3% in Q4, reflecting seasonality and import competition that weighed on volumes and mix.
Ongoing Import and Triangulation Risk
Unfair import competition (notably Chinese surplus) materially impacted 2025 results; risks remain of circumvention/triangulation (e.g., via Vietnam or Korea) which could blunt effectiveness of trade measures and delay margin recovery.
Cost Pressure from Input Price Trends (Coal)
Recent increases in coal prices are expected to feed into costs, with management indicating cost pressure may be felt starting in Q2 2026 despite Q1 stability.
Seasonality and Short-term Mining Volume Risk
Management expects lower mining sales volumes in early 2026 due to rainy-season logistics and a decision to prioritize higher-margin areas, implying near-term production volatility.
No Dividend Payout in the Short Term
Because of a prior impairment and its impact on retained earnings, management indicated they are not planning dividends for the prior year, leaving shareholder returns uncertain until earnings normalize.
One-off Impairment and Past Quarter Effects
EBITDA and reported figures were affected by impairments and absence of extraordinary fixed-asset sale gains that had benefited prior quarters, complicating quarter-to-quarter comparability.
Company Guidance
Usiminas guided to stable steel unit sales in 2026 with a recovery in domestic net revenue per ton driven by a “more noble” sales mix and higher prices, even as cost/ton is expected to rise with that mix — management expects EBITDA margins above Q4; mining is forecast to report lower volumes in Q1 due to rainy‑season logistics while prioritizing higher‑margin areas. Key metrics cited: 2025 adjusted consolidated EBITDA of BRL 2.0bn (margin ~8%), with EBITDA growth of ~+46% in mining and +16% in steel; steel sales of 4.4 Mt in 2025; record mining sales of 9.6 Mt (+14% y/y) and annual mining net revenue +27%; net revenue BRL 6.2bn (Q4, +6.5% q/q). Financial guidance and cash: FY free cash flow ~BRL 989m (Q4 FCF BRL 744m), operational cash flow BRL 1.1bn, working‑capital release BRL 576m, CapEx guidance ~BRL 1.6bn for 2026 (prior range cited BRL 1.2–1.4bn), quarter CapEx BRL 372m; year‑end net cash BRL 444m and negative leverage 0.22x. Market and policy assumptions: Brazil GDP +1.8% (Focus), flat‑steel consumption ~+1% in 2026, imports ~4 Mt in 2025 (expected to grow ~4% in 2026) with 60–65% from China, recent tariff measures +9% and anticipated definitive anti‑dumping outcomes by mid‑year (July) to help restore domestic volumes; inventories were reported at ~4 months for the chain (importers >6 months).Usiminas Financial Statement Overview
Summary
Income statement weakness is significant (profitability deterioration and losses in 2024–2025 after stronger prior years), partially offset by a relatively solid balance sheet (moderate leverage) and improved 2025 cash generation with positive free cash flow. Overall financial profile remains cyclical and volatile with pressure below the operating line.Income Statement
Revenue has been essentially flat to down over time (declines in 2022–2025), and profitability has deteriorated sharply from strong 2021–2022 levels. The company moved from solid profits in 2020–2023 to losses in 2024 and a much larger loss in 2025, with net margin falling to roughly -12% in 2025. While gross and EBITDA margins remain positive, the swing to negative net income indicates substantial pressure below the operating line and elevated earnings volatility for a cyclical steel business.36
Negative
Balance Sheet
Leverage looks controlled, with debt-to-equity consistently around ~0.27–0.41 and ending 2025 near ~0.32, which is reasonable for the industry. However, equity has declined from 2023 to 2025, and returns on equity turned negative in 2024, signaling weaker value creation recently. Overall, the balance sheet appears relatively sturdy, but shrinking equity alongside losses is a developing risk if profitability does not recover.70
Positive
Cash Flow
Cash generation improved meaningfully in 2025, with operating cash flow rising versus 2024 and free cash flow solidly positive after being near breakeven/negative in 2024 and 2022. That said, cash flow has been volatile across years, and in 2025 operating cash flow covered only about ~56% of obligations implied by the provided coverage ratio, suggesting liquidity is better but not yet strong. Positive free cash flow in the latest year is a key strength, but consistency remains a concern.63
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 25.84B | 25.87B | 27.64B | 32.47B | 33.74B |
| Gross Profit | 2.12B | 1.66B | 1.79B | 5.68B | 11.27B |
| EBITDA | 1.83B | 1.81B | 2.92B | 4.77B | 13.57B |
| Net Income | -3.02B | -145.95M | 1.39B | 1.62B | 9.07B |
Balance Sheet | |||||
| Total Assets | 36.81B | 39.87B | 40.16B | 40.00B | 39.48B |
| Cash, Cash Equivalents and Short-Term Investments | 6.94B | 5.95B | 6.01B | 5.07B | 7.02B |
| Total Debt | 6.57B | 7.76B | 7.60B | 6.32B | 6.38B |
| Total Liabilities | 13.12B | 13.19B | 13.61B | 14.11B | 15.12B |
| Stockholders Equity | 20.80B | 23.88B | 23.86B | 23.16B | 21.75B |
Cash Flow | |||||
| Free Cash Flow | 1.25B | -6.00M | 1.58B | -1.09B | 3.81B |
| Operating Cash Flow | 2.28B | 989.16M | 4.57B | 997.12M | 5.30B |
| Investing Cash Flow | -2.12B | -900.93M | -2.00B | -3.34B | -325.73M |
| Financing Cash Flow | -65.22M | -423.37M | -775.79M | -1.09B | -1.88B |
Usiminas Technical Analysis
Positive
1.25
Price Trends
1.20
Positive
1.09
Positive
0.96
Positive
Market Momentum
0.04
Negative
61.81
Neutral
93.12
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For USNZY, the sentiment is Positive. The current price of 1.25 is above the 20-day moving average (MA) of 1.24, above the 50-day MA of 1.20, and above the 200-day MA of 0.96, indicating a bullish trend. The MACD of 0.04 indicates Negative momentum. The RSI at 61.81 is Neutral, neither overbought nor oversold. The STOCH value of 93.12 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for USNZY.
Usiminas Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $8.16B | 18.89 | 10.51% | 1.02% | -1.61% | -81.36% | |
65 Neutral | $47.43B | 15.72 | 6.12% | 1.03% | -4.51% | ― | |
65 Neutral | $8.52B | 20.02 | 3.49% | 7.02% | -16.69% | 585.38% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
61 Neutral | $7.48B | 32.61 | 2.47% | 2.92% | -2.53% | -36.08% | |
57 Neutral | $1.65B | -2.88 | 1.52% | ― | -8.05% | -435.96% | |
53 Neutral | $2.15B | -8.09 | -10.50% | ― | -5.79% | -5.30% |
* Basic Materials Sector Average
USNZY
Usiminas
1.25
0.28
28.45%
MT
ArcelorMittal
60.07
30.27
101.58%
CMC
Commercial Metals Company
71.61
26.97
60.41%
GGB
Gerdau SA
3.70
0.98
36.03%
SID
Companhia Siderúrgica Nacional
1.50
0.11
7.91%
TX
Ternium SA
41.60
15.36
58.54%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.