One of the largest iron ore producers in the world, Vale’s (VALE) shares have plunged significantly from its 52-week high of $23.18, which it hit on June 25, 2021. However, it could be wise to buy the dip in the stock because of its solid financials. Read on for details.Headquartered in Rio de Janeiro, Brazil, Vale S.A. (VALE) is one of the largest iron ore, pellets, and nickel producers. The company has run into several issues over the past few years. On October 5, it halted the production of copper concentrate at its Salobo mine. In June 2021, Judge Vivianne Celia Ferreira Ramos Correa ordered VALE to pay $197,240 in compensation to each of the families of 131 employees killed in the collapse of a mining dam in 2019. Consequently, the stock has lost 39.4% since hitting its 52-week high of $23.18 on June 25, 2021, to close yesterday’s trading session at $13.74.
The stock has gained 27.8% over the past year. Its revenue and EPS have grown at CAGRs of 35.7% and 74.7%, respectively, over the past three years. VALE paid $7.60 billion in first-half dividends, its largest payout since its 2019 dam collapse. Moreover, its top line and bottom line increased in the second quarter. So, the stock’s near-term prospects look promising.
Here are the factors that could shape VALE’s performance in the upcoming months: