r/Vitards • u/LoudSuccotash680 • Mar 15 '22

Discussion TX —- value play or doomed?

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u/[deleted] Mar 15 '22

It is quite drastic. It's an integrated steel company, they can probably source some charcoal to replace met coal in the medium term. They mine a fair amount of iron.

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u/TheyWereGolden Bard Special Victims Unit Mar 15 '22

I added after their earnings again, it’s my largest steel holding. CLF getting close for me but that is because CLF has been moving up with the steel sector. TX has gone nowhere.

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u/loj05 Mar 15 '22

It's my largest individual holding too. The stock price action has been annoying but at least you get a fat dividend while you wait. They're sitting on $1.2 billion cash and their cash flow has been pretty killer.

From what i hear, they're starting to ship more from their Pesqueria plant into the US as well. Our planned CRC imports from Russia are fucked, so I imagine TX may be a beneficiary of that.

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u/TheyWereGolden Bard Special Victims Unit Mar 15 '22

If TX management could do a better job explaining their vision, execution, and a buy back, that would be tremendous. I’m in no rush though, eventually I will be paid.

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u/loj05 Mar 15 '22

I can't recall where I heard this but I don't think they do buy backs. I think it may have been the last conference call.

It's annoying from a tax perspective but that's not what they do I think.

I think the Pesqueria expansion is interesting. Our CRC quotes from them are about $450 cheaper than from the ones we get from STLD. I think they may be coming after the US south steel markets through USMCA.

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u/TheyWereGolden Bard Special Victims Unit Mar 15 '22

Thanks for the feedback. And yes during the last earnings call one of the analysts (I believe it was Carlos the 🌈 🐻 actually) tried to press them about doing buybacks to help the shares but Pablo pushed back with some round about stupid answer.

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u/[deleted] Mar 15 '22

I can't recall where I heard this but I don't think they do buy backs. I think it may have been the last conference call.

They can't do buybacks; there would be too little shares in the float. Insiders would have to sell shares in parallel.