WEBULL

S.C. ArcelorMittal Hunedoara S.A. (BVB:SIDG) May Have Run Too Fast Too Soon With Recent 28% Price Plummet

Simply Wall St · 2d ago

S.C. ArcelorMittal Hunedoara S.A. (BVB:SIDG) shares have retraced a considerable 28% in the last month, reversing a fair amount of their solid recent performance. Longer-term shareholders would now have taken a real hit with the stock declining 2.7% in the last year.

Even after such a large drop in price, when almost half of the companies in Romania's Metals and Mining industry have price-to-sales ratios (or "P/S") below 0.6x, you may still consider S.C. ArcelorMittal Hunedoara as a stock probably not worth researching with its 1.3x P/S ratio. Nonetheless, we'd need to dig a little deeper to determine if there is a rational basis for the elevated P/S.

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View our latest analysis for S.C. ArcelorMittal Hunedoara

ps-multiple-vs-industry
BVB:SIDG Price to Sales Ratio vs Industry December 28th 2025

How S.C. ArcelorMittal Hunedoara Has Been Performing

As an illustration, revenue has deteriorated at S.C. ArcelorMittal Hunedoara over the last year, which is not ideal at all. One possibility is that the P/S is high because investors think the company will still do enough to outperform the broader industry in the near future. However, if this isn't the case, investors might get caught out paying too much for the stock.

Although there are no analyst estimates available for S.C. ArcelorMittal Hunedoara, take a look at this free data-rich visualisation to see how the company stacks up on earnings, revenue and cash flow.

Is There Enough Revenue Growth Forecasted For S.C. ArcelorMittal Hunedoara?

There's an inherent assumption that a company should outperform the industry for P/S ratios like S.C. ArcelorMittal Hunedoara's to be considered reasonable.

In reviewing the last year of financials, we were disheartened to see the company's revenues fell to the tune of 39%. This means it has also seen a slide in revenue over the longer-term as revenue is down 57% in total over the last three years. So unfortunately, we have to acknowledge that the company has not done a great job of growing revenue over that time.

In contrast to the company, the rest of the industry is expected to grow by 5.6% over the next year, which really puts the company's recent medium-term revenue decline into perspective.

With this information, we find it concerning that S.C. ArcelorMittal Hunedoara is trading at a P/S higher than the industry. Apparently many investors in the company are way more bullish than recent times would indicate and aren't willing to let go of their stock at any price. Only the boldest would assume these prices are sustainable as a continuation of recent revenue trends is likely to weigh heavily on the share price eventually.

The Key Takeaway

Despite the recent share price weakness, S.C. ArcelorMittal Hunedoara's P/S remains higher than most other companies in the industry. Generally, our preference is to limit the use of the price-to-sales ratio to establishing what the market thinks about the overall health of a company.

We've established that S.C. ArcelorMittal Hunedoara currently trades on a much higher than expected P/S since its recent revenues have been in decline over the medium-term. Right now we aren't comfortable with the high P/S as this revenue performance is highly unlikely to support such positive sentiment for long. Unless the the circumstances surrounding the recent medium-term improve, it wouldn't be wrong to expect a a difficult period ahead for the company's shareholders.

We don't want to rain on the parade too much, but we did also find 4 warning signs for S.C. ArcelorMittal Hunedoara (3 make us uncomfortable!) that you need to be mindful of.

It's important to make sure you look for a great company, not just the first idea you come across. So if growing profitability aligns with your idea of a great company, take a peek at this free list of interesting companies with strong recent earnings growth (and a low P/E).