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Strategies & Market Trends : Value Investing
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To: Paul Senior who wrote (41800)1/6/2015 2:40:33 PM
From: E_K_S1 Recommendation

Recommended By
Mattyice

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GGB coming back on my value list. Do not like Brazil but looking back from my Buys at $3.50 in 2005 and subsequent sales in 2009 at $9.54/share, $3.50/share is again looking attractive.

It seems like the cycle bottom could/may be in but who knows. GGB is the world's low cost producer and a lot of steel pipe is/was manufactured and sent to the U.S.. Maybe less demand w/ oil prices down but China is the real wild card. I do not expect the EU to be using too much steel either.

So my value premise is based on BV selling at 0.5x BV (BV is $ 7.10/share). Debt still quite large at $7Bln almost 14x their current net income. Also, that debt may be paid back in $US and the currency exchange rate is not to their advantage either.

My last hold was 4 years for a double in value and peak cycle, so maybe 2015 is the bottom of the cycle. No buys yet, but on my watch list for a possible start of a new long term position.

Any thoughts?

EKS
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