Vale’s Failures Don’t Make It Uninvestable

Summary:

  • Vale S.A. has made significant safety improvements, removing 90% of tailings and decreasing its injury rate by over 60%.
  • The company is expanding its iron ore capacity, with plans to add 50 million tonnes/year by 2026.
  • Vale’s financial performance has been strong, with increased EBITDA and cash flow, enabling substantial shareholder returns.

Aerial view of Open-pit iron mine

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Vale S.A. (NYSE:VALE) has had a tailings problem in Brazil, one that has cost it billions of dollars. It started with the Mariana dam disaster in 2020, which killed 19 people. It was followed up by the Brumadinho dam disaster


Analyst’s Disclosure: I/we have a beneficial long position in the shares of VALE either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha’s Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.


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