Why ArcelorMittal Is Poised to Bounce Back

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, steel giant ArcelorMittal (NYSE: MT  ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at ArcelorMittal and see what CAPS investors are saying about the stock right now.

ArcelorMittal facts

Headquarters (founded)

Luxembourg (1989)

Market Cap

$20.7 billion

Industry

Steel

Trailing-12-Month Revenue

$84.2 billion

Management

Chairman/CEO Lakshmi Mittal

CFO Aditya Mittal

Return on Equity (average, past 3 years)

0.4%

Cash/Debt

$4.4 billion / $26.3 billion

Dividend Yield

4.7%

Competitors

POSCO

Nucor

United States Steel

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 97% of the 2,098 members who have rated ArcelorMittal believe the stock will outperform the S&P 500 going forward.

Just yesterday, one of those Fools, Truslunch, tapped ArcelorMittal as a particularly solid bargain opportunity:

Largest steel producer in the world sitting at 52-week lows. This is a good value opportunity. Stock has taken a beating from market due to recession, fears on European economy, and lack of demand. [ArcelorMittal] has been closely associated with Europe ... but this is a global company. ... [T]here is a lot of opportunity in Asia when demand picks back up. So I'm a buyer from here. Huge upside long-term potential that pays me [a +4% dividend yield] to wait for a global recovery and is poised to benefit the most from future Asian development? Yes, please.

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Read/Post Comments (6) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On March 26, 2013, at 12:05 PM, Twighlight wrote:

    Please do your research before writing an article. Their forward dividend is far less than 4.7%

  • Report this Comment On March 26, 2013, at 1:04 PM, JuneSmith wrote:

    Dividend is $1/sh, so dividend yield is about 1.4%, not 4.7. MT SLASHED ITS DIVIDEND IN THE PAST SEVERAL MONTHS!!!

  • Report this Comment On March 26, 2013, at 10:40 PM, vireoman wrote:

    On Oct 31, MT slashed their annual dividend down to 0.20 per share. Why MF, Yahoo Finance and Morningstar continue to list it at 4.7% is a mystery to me. As for MT as a stock, I've bought three times in the 13s (including this morning). If it drops more, I'll buy more. I may sell in the 16s or 17s, or I may keep if the situation in Europe improves dramatically. (In other words, I'll be selling in the coming months for the third time in the past year).

  • Report this Comment On March 27, 2013, at 10:54 AM, mikecart1 wrote:

    If you bet against steel - either MT of another decent steel maker, then you probably shouldn't be investing or call yourself an investor. Betting against steel is like betting against oil. It just doesn't end well...

    :)

  • Report this Comment On March 27, 2013, at 6:49 PM, Truslunch wrote:

    @ Brian: Thanks for quoting my stream of thought from the other day. I did not expect that, but it did brighten my day.

    @Twighlight & JuneSmith: I was wondering if you could elaborate on your reference to the dividend being cut to closer to 1.4%. I went back and looked at the payments I have received and they quarterly payment was just short of $.20 per share (less after Uncle Sam took his cut) and the annual dividend was close to $.75 - .80 per share. Which put the yield close to 4.7% (depending on what price is being used in the calculation). If I'm wrong about hat please let me know what I am missing, I'm a relatively young investor so any insight you may have would be helpful. The yield is the main reason I have continued to buy on the dips as vireoman explained in his strategy. It would strike me as odd if MF, yahoo, google finance, seekingalpha, etc all had incorrect yields.

    I have a pretty long term horizon (about 50 years, give or take) when I buy MT so maybe I'm seeing this situation through a different perspective.

    Bought some today for below 13!

  • Report this Comment On March 28, 2013, at 11:47 AM, Sue10661 wrote:

    I don't know where thes figures come from. MT used to pay quarterly. This year According to their website they will pay anually $.20 on July 15 subject to the May annual meeting. I also believe in the long term value of MT Steel and I would rather have a company reduce it's dividend in hard times than ignore the economic reality and pay out much more than it takes in. Foolish or not I am going to hold.

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