Stephen Simpson, CFA
Long only, growth at reasonable price, value, research analyst

Fears About Argentina And Mexico Have Ternium Looking Cheap

Argentina is a mess right now, and the companies with ties to that country are paying the price - some deserved, some not so much. I would place Ternium (NYSE:TX) in the "not so much" camp, as although the company does generate a substantial amount of EBITDA in Argentina, the business isn't as vulnerable as valuation would suggest. More to the point, this is a well-run and growing Mexico-based steel company with some measure of influence over its input costs.

What It Is

Legally headquartered in Luxembourg, around 70% of Ternium's capacity is located in Mexico, where the company produces primarily flat-rolled steel for the automotive, machinery, and energy markets. More than half of the company's sales are...

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