Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 7 stocks made the list for top value stocks in the Metals & Mining - Iron & Steel industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Metals & Mining - Iron & Steel Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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7 Undervalued Metals & Mining - Iron & Steel Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 7 undervalued stocks in the Metals & Mining - Iron & Steel industry for Tuesday, February 27, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Metals & Mining - Iron & Steel industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Highway Holdings Limited’s Value Grade

Value Grade:

Highway Holdings Limited is a holding company. The Company manufactures and supplies various metal, plastic and electric parts, components and products to its original equipment manufacturing (OEM) clients, which are used by the Company's customers in the manufacturing of products, such as photocopiers, laser printers, compact disc players, laser disc players, computer equipment, electrical components, electrical connectors, vacuum cleaners, light fixtures, electro motors, pumps, automobiles and dishwasher, and other washing machine components. The Company operates in two segments: the metal stamping and mechanical OEM segment, and the electric OEM segment. The metal stamping and mechanical OEM segment focuses on the manufacture and sale of metal parts and components, whereas the electric OEM segment focuses on the manufacture and sale of plastic and electronic parts, components and machines.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Highway Holdings Limited has a Value Score of 75, which is considered to be undervalued.

When you look at Highway Holdings Limited’s price-to-sales ratio at 1.07 compared to the industry median at 0.55, this company has a higher price relative to revenue compared to its peers. This could make Highway Holdings Limited’s stock less attractive for value investors.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Highway Holdings Limited’s shareholder yield is lower than its industry median ratio of 2.14%. Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Highway Holdings Limited’s price-to-book ratio is lower than its industry median ratio of 1.23. This could make Highway Holdings Limited more attractive to investors looking for a new addition to their portfolio.

Posco Holdings Inc (ADR)’s Value Grade

Value Grade:

Posco Holdings Inc, formerly Posco, is a Korea-based company principally engaged in the manufacture and distribution of steel products. The Company operates its business through four segments. The Steel segment produces and sells steel products such as hot rolled steel, cold rolled steel, stainless steel, among others. The Trading segment engages in the global trade, including the export and import of steel products. The Engineering and Construction (E&C;) segment plans, designs and builds industrial plants, civil engineering projects, commercial and residential buildings. The Other segment is engaged in the power plants, information and communication related services and other businesses.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Posco Holdings Inc (ADR) has a Value Score of 72, which is considered to be undervalued.

Posco Holdings Inc (ADR)’s price-earnings ratio is 26.6 compared to the industry median at 12.4. This means that it has a higher price relative to its earnings compared to its peers. This makes Posco Holdings Inc (ADR) less attractive for value investors.

Posco Holdings Inc (ADR)’s price-to-book ratio is higher than its peers. This could make Posco Holdings Inc (ADR) less attractive for value investors when compared to the industry median at 1.23.

You can read more about Posco Holdings Inc (ADR)’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Ryerson Holding Corp’s Value Grade

Value Grade:

Ryerson Holding Corporation is a value-added processor and distributor of industrial metals, with operations in the United States, Canada, Mexico, and China. The Company carries a full line of carbon steel, stainless steel, alloy steels, and aluminum, and a limited line of nickel and red metals. These materials are stocked in a number of shapes, including coils, sheets, rounds, hexagons, square and flat bars, plates, structural, and tubing. The Company also provide a variety of processing services to meet its customer’ s needs. It also conducts metal processing and distribution operations in China. It has approximately 110 facilities in North America and four facilities in China. The Company offers various value-added processing and fabrication services, such as bending, beveling, blanking, blasting, burning, cutting-to length, drilling, embossing, flattening, forming, grinding, laser cutting, machining, notching, painting, perforating, polishing, punching, rolling, and sawing.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Ryerson Holding Corp has a Value Score of 93, which is considered to be undervalued.

Ryerson Holding Corp’s price-earnings ratio is 12.0 compared to the industry median at 12.4. This means that it has a lower price relative to its earnings compared to its peers. This makes Ryerson Holding Corp more attractive for value investors.

Ryerson Holding Corp’s price-to-book ratio is lower than its peers. This could make Ryerson Holding Corp fairly attractive for value investors when compared to the industry median at 1.23.

You can read more about Ryerson Holding Corp’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Sims Ltd (ADR)’s Value Grade

Value Grade:

Sims Limited is engaged in metal recycling and provides circular solutions for technology. The principal activities of the Company include buying, processing, and selling of ferrous and non-ferrous recycled metals, and supporting businesses and data centers in managing end-of-life physical information technology (IT) assets through reuse, redeployment, and recycling. This includes IT asset disposition (ITAD) and e-waste recycling solutions. The Company's North America Metal (NAM), Australia and New Zealand Metal (ANZ) and UK Metal (UK) segments are engaged in ferrous and non-ferrous secondary recycling functions. Its Global Trading segment coordinates sales of ferrous bulk cargo shipments, non-ferrous sales into primarily China and Southeast Asia and brokerage sales on behalf of third and related parties. Its SA Recycling (SAR) segment is engaged in an investment in the SA Recycling joint venture. Its Sims Lifecycle Services (SLS) segment provides electronic recycling solutions.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Sims Ltd (ADR) has a Value Score of 67, which is considered to be undervalued.

Sims Ltd (ADR)’s price-earnings ratio is 17.1 compared to the industry median at 12.4. This means that it has a higher price relative to its earnings compared to its peers. This makes Sims Ltd (ADR) less attractive for value investors.

Sims Ltd (ADR)’s price-to-book ratio is higher than its peers. This could make Sims Ltd (ADR) less attractive for value investors when compared to the industry median at 1.23.

You can read more about Sims Ltd (ADR)’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

SunCoke Energy Inc’s Value Grade

Value Grade:

SunCoke Energy, Inc. is an independent producer of coke. The Company’s segments include Domestic Coke, Brazil Coke, and Logistics. The Domestic Coke segment consists of coke making facilities and heat recovery operations at its Jewell, Indiana Harbor, Haverhill, Granite City and Middletown plants. The Brazil segment consists of coke making operations located in Vitoria, Brazil, where it operates the ArcelorMittal Brazil coke making facility for a Brazilian subsidiary of ArcelorMittal S.A. The Logistics segment consists of Convent Marine Terminal (CMT), Kanawha River Terminal (KRT) and SunCoke Lake Terminal (Lake Terminal). Its terminals act as intermediaries between its customers and end users by providing transloading and mixing services. CMT is located in Convent, Louisiana, with access to seaborne markets for coal and other industrial materials. The terminal provides loading and unloading services and has direct rail access.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

SunCoke Energy Inc has a Value Score of 86, which is considered to be undervalued.

SunCoke Energy Inc’s price-earnings ratio is 16.3 compared to the industry median at 12.4. This means that it has a higher price relative to its earnings compared to its peers. This makes SunCoke Energy Inc less attractive for value investors.

SunCoke Energy Inc’s price-to-book ratio is lower than its peers. This could make SunCoke Energy Inc more attractive for value investors when compared to the industry median at 1.23.

You can read more about SunCoke Energy Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Ternium SA (ADR)’s Value Grade

Value Grade:

Ternium S.A. is a producer of steel products. The Company produces finished and semi-finished steel products and iron ore, which are sold either directly to steel manufacturers, steel processors or end users. The Company operates through two segments: Steel and Mining. The Steel segment includes the sales of steel products and the Mining segment includes the sales of iron ore products, which are primarily inter-company. The Steel segment comprises three operating segments: Mexico, the Southern Region and Other Markets. In the steel segment, steel products include slabs, billets and round bars (steel in its basic, semi-finished state), hot-rolled coils and sheets, bars and stirrups, wire rods, cold-rolled coils and sheets, tin plate, hot dipped galvanized and electrogalvanized sheets and pre-painted sheets, steel pipes and tubular products, beams, roll-formed products, and other products. In the mining segment, iron ore is sold as concentrates (fines) and pellets.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Ternium SA (ADR) has a Value Score of 97, which is considered to be undervalued.

Ternium SA (ADR)’s price-earnings ratio is 11.6 compared to the industry median at 12.4. This means that it has a lower price relative to its earnings compared to its peers. This makes Ternium SA (ADR) more attractive for value investors.

Ternium SA (ADR)’s price-to-book ratio is higher than its peers. This could make Ternium SA (ADR) less attractive for value investors when compared to the industry median at 1.23.

You can read more about Ternium SA (ADR)’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Vale SA (ADR)’s Value Grade

Value Grade:

Vale SA, formerly Companhia Vale do Rio Doce, is a Brazil-based metal and mining company which is primarily engaged in producing iron ore and nickel. The Company also produces iron ore pellets, copper, platinum group metals (PGMs), gold, silver and cobalt. Vale is engaged in greenfield mineral exploration in five countries and operates logistics systems in Brazil and other regions in the world, including railroads, maritime terminals and ports, which are integrated with mining operations. In addition, Vale has distribution centers to support the delivery of iron ore worldwide. Vale has numerous subsidiaries, including Vale Logistica Uruguay SA, Vale Holdings BV, Vale Overseas Ltd. The Company’s operations abroad cover approximately 30 countries.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Vale SA (ADR) has a Value Score of 80, which is considered to be undervalued.

Vale SA (ADR)’s price-earnings ratio is 7.2 compared to the industry median at 12.4. This means that it has a lower price relative to its earnings compared to its peers. This makes Vale SA (ADR) more attractive for value investors.

Vale SA (ADR)’s price-to-book ratio is lower than its peers. This could make Vale SA (ADR) more attractive for value investors when compared to the industry median at 1.23.

You can read more about Vale SA (ADR)’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Metals & Mining - Iron & Steel Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Metals & Mining - Iron & Steel stocks as well as other industrys.

Choosing Which of the 7 Best Metals & Mining - Iron & Steel Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Highway Holdings Limited stock has a Value Grade of B.
• Posco Holdings Inc (ADR) stock has a Value Grade of B.
• Ryerson Holding Corp stock has a Value Grade of A.
• Sims Ltd (ADR) stock has a Value Grade of B.
• SunCoke Energy Inc stock has a Value Grade of A.
• Ternium SA (ADR) stock has a Value Grade of A.
• Vale SA (ADR) stock has a Value Grade of B.

Now that you have a bit more background about each of the 7 undervalued stocks in the Metals & Mining - Iron & Steel industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Metals & Mining - Iron & Steel Stocks

Want to learn more about Metals & Mining - Iron & Steel stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 7 Undervalued Metals & Mining - Iron & Steel Stocks for Tuesday, February 27
• 3 Undervalued Metals & Mining - Iron & Steel Stocks for Monday, February 26
• Why Alpha Metallurgical Resources Inc’s (AMR) Stock Is Up 13.42%
• Why Ramaco Resources Inc’s (METC) Stock Is Up 6.90%

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