CSTM

Constellium SE

Industrial/Transportation


Presented:10/17/2019
Price:$13.97
Cap:$1.91B
Current Price:$14.54
Cap:$2.13B

Presented

Date10/17/2019
Price$13.97
Market Cap$1.91B
Ent Value$3.89B
P/E Ratio8.22x
Book ValueN/A
Div Yield0%
Shares O/S136.79M
Ave Daily Vol1,177,925
Short Int0.60%

Current

Price$14.54
Market Cap$2.13B
Constellium SE operates as a holding company with interest in the design and manufacture of a range of specialty rolled, and extruded aluminum products, serving primarily the aerospace, packaging and automotive end-markets. The company operates through the following segments: Packaging & Automotive Rolled Products, Aerospace & Transportation, and Automotive Structures & Industry. The Packaging & Automotive Rolled Products segment includes the production of rolled aluminum products. The Aerospace & Transportation segment includes the production of rolled and extruded aluminum products for the aerospace market, as well as rolled products for transport and industry end-uses. The Automotive Structures & Industry segment includes crash-management systems, body structures and side impact beams in Germany, North America and China. The company was founded on May 14, 2010 and is headquartered in Schiphol-Rijk, the Netherlands.

Publicly traded companies mentioned herein: Arconic Inc (ARNC), Ball Corporation (BLL), Coca-Cola Co (KO), Constellium SE (CSTM), Crown Holdings Inc (CCK), Hindalco Industries Ltd (HNDL IN), PepsiCo Inc (PEP)

Highlights

The presenter is long shares of Constellium (CSTM), and sees an opportunity for secular growth in the aluminum end markets for autos, specifically EVs, and beverage cans. He believes that aluminum content in autos will continue to increase, and that the beverage can market has turned as packaging moves away from plastics. On this year’s numbers, CSTM is currently trading at a 10% FCF yield, is sub 4x levered, and headed toward 3.7x levered by the end of this year. That 10% FCF yield is encumbered by an auto capacity build out that won’t be done until 2022. Based on his 2022 numbers the stock is trading at a 30% FCF yield. 

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