As of today (2026-06-26), ArcelorMittal South Africa's weighted average cost of capital is 15.61%%. ArcelorMittal South Africa's ROIC % is -15.98% (calculated using TTM income statement data).
ArcelorMittal South Africa earns returns that do not match up to its cost of capital. It will destroy value as it grows.
For a comprehensive WACC calculation, please access the WACC Calculator.
ArcelorMittal South Africa (STU:ISC1) WACC % Explanation
Because it costs money to raise capital. A firm that generates higher ROIC % than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, ArcelorMittal South Africa's weighted average cost of capital is 15.61%%. ArcelorMittal South Africa's ROIC % is -15.98% (calculated using TTM income statement data).
ArcelorMittal South Africa earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Be Aware
1. GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding latest one-year semi-annual average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together.
For companies that report quarterly, GuruFocus combines all of the most recent year's quarterly debt data from the beginning of the year to the year-end and calculates the average.
For companies that report semi-annually, GuruFocus combines all of the most recent year's semi-annual debt data from the start of the year to the year-end and calculates the average.
For companies that report annually, GuruFocus combines the beginning and ending annual debt data from the most recent year and then calculates the average.
2. The WACC formula discussed above does not include Preferred Stock. Please adjust if preferred stock is considered.
3. (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
4. GuruFocus uses the latest TTM Interest Expense divided by the latest one-year semi-annual average debt to get the simplified cost of debt.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Steel subindustry, ArcelorMittal South Africa's WACC %, along with its competitors' market caps and WACC % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
ArcelorMittal South Africa WACC % vs Steel Industry
For the Steel industry and Basic Materials sector, ArcelorMittal South Africa's WACC % distribution charts can be found below:
* The bar in red indicates where ArcelorMittal South Africa's WACC % falls into.
The weighted average cost of capital (WACC) is the rate that a company is expected to pay on average to all its security holders to finance its assets. The WACC is commonly referred to as the firm's cost of capital. Generally speaking, a company's assets are financed by debt and equity. WACC is the average of the costs of these sources of financing, each of which is weighted by its respective use in the given situation. By taking a weighted average, we can see how much interest the company has to pay for every dollar it finances.
WACC
=
E
/
(E + D)
*
Cost of Equity
+
D
/
(E + D)
*
Cost of Debt
*
(1 - Tax Rate)
1. Weights:
Generally speaking, a company's assets are financed by debt and equity. We need to calculate the weight of equity and the weight of debt.
The market value of equity (E) is also called "Market Cap". As of today, ArcelorMittal South Africa's market capitalization (E) is €77.011 Mil.
The market value of debt is typically difficult to calculate, therefore, GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding the latest one-year semi-annual average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together. As of Dec. 2025, ArcelorMittal South Africa's latest one-year semi-annual average Book Value of Debt (D) is €475.1153 Mil.
a) weight of equity = E / (E + D) = 77.011 / (77.011 + 475.1153) = 0.1395
b) weight of debt = D / (E + D) = 475.1153 / (77.011 + 475.1153) = 0.8605
2. Cost of Equity:
GuruFocus uses Capital Asset Pricing Model (CAPM) to calculate the required rate of return. The formula is:
Cost of Equity = Risk-Free Rate of Return + Beta of Asset * (Expected Return of the Market - Risk-Free Rate of Return)
a) GuruFocus uses 10-Year Treasury Constant Maturity Rate as the risk-free rate. It is updated daily. The current risk-free rate is 8.995%. Please go to Economic Indicators page for more information. Please note that we use the 10-Year Treasury Constant Maturity Rate of the country/region where the company is headquartered. If the data for that country/region is not available, then we will use the 10-Year Treasury Constant Maturity Rate of the United States as default.
b) Beta is the sensitivity of the expected excess asset returns to the expected excess market returns. ArcelorMittal South Africa's beta is 0.2383.
c) (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
Cost of Equity = 8.995% + 0.2383 * 6% = 10.4248%
3. Cost of Debt:
GuruFocus uses latest TTM Interest Expense divided by the latest one-year semi-annual average debt to get the simplified cost of debt.
As of Dec. 2025, ArcelorMittal South Africa's interest expense (positive number) was €78.355 Mil. Its total Book Value of Debt (D) is €475.1153 Mil.
Cost of Debt = 78.355 / 475.1153 = 16.4918%.
4. Multiply by one minus TTM Tax Rate:
GuruFocus uses the most recent TTM Tax Expense divided by the most recent TTM Pre-Tax Income to calculate the tax rate. The calculated TTM tax rate is limited to between 0% and 100%. If the calculated tax rate is higher than 100%, it is set to 100%. If the calculated tax rate is less than 0%, it is set to 0%.
The latest calculated TTM Tax Rate = -0.406 / -145.597 = 0.28%.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
ArcelorMittal South Africa (STU:ISC1) has a WACC % of 15.61% as of Jun. 26, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on ArcelorMittal South Africa and its competitors. This is 22% below median its historical median of 19.94. Over the past decade, ArcelorMittal South Africa's WACC % has ranged from 11.40 to 23.86. According to the industry distribution chart, ArcelorMittal South Africa ranks #597 out of 642 companies in the Steel industry, placing it in the top 93%.
Is ArcelorMittal South Africa's WACC % too high?
ArcelorMittal South Africa's current WACC % of 15.61% is 22% below median its 10-year median of 19.94. Over the past 10 years, this metric has ranged from a low of 11.40 to a high of 23.86. The Steel industry median WACC % is 7.78. ArcelorMittal South Africa's value of 15.61% is 100.8% above this industry median. Based on the distribution chart, ArcelorMittal South Africa ranks #597 out of 642 companies in the Steel industry, which is in the bottom quartile relative to peers. Overall, ArcelorMittal South Africa has a GF Score™ of 54/100, reflecting its overall financial health beyond just this single metric.
How does ArcelorMittal South Africa's WACC % compare to NUE and STLD?
According to the Steel industry distribution chart, ArcelorMittal South Africa ranks #597 out of 642 companies for WACC %. This places ArcelorMittal South Africa in the lower half of its industry. The industry median WACC % is 7.78. ArcelorMittal South Africa's value of 15.61% is 100.8% above this benchmark. Historically, ArcelorMittal South Africa's own WACC % has ranged from 11.40 to 23.86 over the past decade. While the company's 10-year median is 19.94 vs. the industry median of 7.78, ArcelorMittal South Africa has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good WACC % for a Steel company?
The median WACC % among Steel companies is 7.78, based on 642 companies in the industry. Companies in the top quartile (top 25%) have a WACC % significantly above this median, while those in the bottom quartile fall well below. However, WACC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. ArcelorMittal South Africa's current WACC % of 15.61% is 100.8% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high WACC % mean?
A high WACC % can signal that a stock is expensive relative to its fundamentals. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on ArcelorMittal South Africa and its competitors. For the Steel industry, the median WACC % is 7.78 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. ArcelorMittal South Africa's current WACC % is 15.61%, which is 22% below median its own 10-year median of 19.94. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is ArcelorMittal South Africa stock overvalued right now?
ArcelorMittal South Africa (STU:ISC1) has a current WACC % of 15.61%. The stock's GF Value™ is €0.06, compared to a current price of €0.06 — trading 0.8% above its estimated fair value. The current WACC % is 15.61%, which is 22% below median its 10-year median of 19.94 and 100.8% above the Steel industry median of 7.78. ArcelorMittal South Africa's overall GF Score™ is 54/100 with 7 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is WACC % calculated?
WACC % is calculated from a company's financial statements. For ArcelorMittal South Africa (STU:ISC1), the current WACC % is 15.61% as of Jun. 26, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is ArcelorMittal South Africa (STU:ISC1) Overvalued in 2026?
Based on GuruFocus' analysis, ArcelorMittal South Africa stock appears to be overvalued.
The current stock price of €0.06 is trading 0.8% above its estimated GF Value™ of €0.06.
Key valuation signals for STU:ISC1:
WACC %: 15.61% (22% below median its 10-year median of 19.94)
GF Value™: €0.06 vs. price of €0.06 (0.8% above fair value)
Industry Position: 100.8% above the Steel median (#597 of 642)
No single metric tells the full story. See the STU:ISC1 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
ArcelorMittal South Africa Ltd is a South Africa-based steel-producing company. The company's operating segments include Steel operations; Non-steel operations; Corporate and others. It generates the majority of total revenue from the Steel Operations segment that consist of Vanderbijlpark plant, Newcastle plant, Vereeniging plant and ArcelorMittal Rail and Structures. The product range consists of hot-rolled coil, plate, coiled rounds, flats, reinforced bars, rounds, billets and channels, and commercial coke among others. The group operates mainly in South Africa. Export sales are mostly sold in sub-Saharan Africa, Asia, Europe, and America.
54GF Score
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