Century Aluminum Co (CENX, Financial) has experienced a remarkable surge in its stock price, with a 48.43% gain over the past week and an impressive 71.51% gain over the past three months. The company's market capitalization now stands at $1.09 billion, with a current stock price of $11.8. This performance has brought the stock to a point where it is considered fairly valued according to the GF Value, which is currently set at $11.94. This is a notable shift from three months ago when the GF Value was at $13.06, and the stock was considered a possible value trap, suggesting investors should think twice before investing.
Understanding Century Aluminum Co
Century Aluminum Co, operating within the Metals & Mining industry, is a key player in the production of primary aluminum and value-added products. With major operations in the United States and Iceland, the company has a significant presence in the aluminum market. Century Aluminum's business model involves a strategic partnership with Glencore, which purchases the majority of its North American production. The company's product portfolio includes high purity aluminum, standard grade aluminum sow and tee bars, as well as value-added billet and foundry products. Additionally, Century owns a carbon anode production facility in the Netherlands, further diversifying its operations.
Profitability Analysis
Century Aluminum's Profitability Rank stands at 4/10 as of September 30, 2023, which reflects challenges in maintaining consistent profitability. The company's Operating Margin is currently at -1.27%, which, while not ideal, is better than 43.74% of 855 companies in the same industry. The ROE (Return on Equity) is deeply negative at -47.01%, yet this is still better than 27.98% of 2,484 companies. Similarly, the ROA (Return on Assets) is at -11.72%, surpassing 55.56% of 2,691 companies. The ROIC (Return on Invested Capital) is also negative at -1.82%, but it is better than 79.98% of 2,658 companies. Over the past decade, Century Aluminum has managed to achieve profitability in only two years, which is still better than 51.16% of 1,202 companies in the industry.
Growth Prospects
When it comes to growth, Century Aluminum holds a Growth Rank of 5/10, indicating a moderate growth trajectory. The company's 3-Year Revenue Growth Rate per Share is at 13.70%, which is better than 54.67% of 589 companies in the same sector. The 5-Year Revenue Growth Rate per Share stands at 8.50%, surpassing 51.94% of 516 companies. Furthermore, the 3-Year EPS without NRI Growth Rate is an impressive 21.50%, which is better than 64.58% of 1,745 companies. These figures suggest that Century Aluminum has been able to grow its revenue and earnings at a steady pace, despite the challenges in profitability.
Investor Confidence
Notable investors have taken positions in Century Aluminum, indicating a level of confidence in the company's future. Ken Fisher (Trades, Portfolio) is the leading holder with 2,337,111 shares, representing 2.53% of the company. First Eagle Investment (Trades, Portfolio) follows with 791,514 shares, accounting for 0.86%, and Jim Simons (Trades, Portfolio) holds 614,499 shares, making up 0.67% of the company. These holdings reflect a belief in the company's potential for growth and recovery.
Competitive Landscape
Century Aluminum operates in a competitive industry, with several key players vying for market share. Kaiser Aluminum Corp (KALU, Financial) has a market capitalization of $1.12 billion, closely trailing Century's own market cap. Constellium SE (CSTM, Financial) is larger, with a market cap of $2.9 billion, while Hindalco Industries Ltd (NSE:HINDALCO, Financial) is significantly larger with a market cap of $14.42 billion. These competitors represent the diverse scale and scope of companies within the Metals & Mining sector.
Conclusion
In conclusion, Century Aluminum Co's recent stock performance has been impressive, with significant gains over the past three months. While the company's profitability metrics are not ideal, they are competitive within the industry. Growth prospects appear moderate but steady, and the presence of notable investors suggests confidence in the company's future. When compared to its competitors, Century Aluminum holds its own, with a market position that could potentially improve with continued growth and improved profitability. Investors should consider these factors, along with industry benchmarks, to evaluate the financial health and investment attractiveness of Century Aluminum Co.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
