Vale S.A. (VALE) DCF Valuation
TGM's two-stage DCF values Vale S.A. (VALE) between $13.26 and $25.67 depending on assumptions, with a base case of $17.50. Growth is taken from the company's own record (5-year revenue CAGR (FCF growth too volatile to use) (floored at 2%)), fading to 2.5% long-run; the discount rate (7.8%) reflects its beta.
What would today's price require?
$15.31 is justified only if free cash flow grows about -0.7% a year (fading to 2.5% long-run) at a 7.8% required return — faster than the company has actually grown.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 0.5%/yr | 8.8% | $13.26 |
| Base case | 2.0%/yr | 7.8% | $17.50 |
| Optimistic | 5.0%/yr | 6.8% | $25.67 |
| Analyst DCF (FMP) | independent reference — different model | $33.31 | |
Current Price
$15.31
Market-Implied Growth
-0.7%/yr
vs -2.8% 5Y actual
Model Scenario Range
$13.26 – $25.67
model output — not a price target
VALE DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for VALE (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $4.5B · 4.26B shares · net debt $11.5B
Estimated Fair Value
$17.15
+12.0% vs $15.31
Sensitivity — fair value by discount rate × terminal growth
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 2.0%/yr FCF growth and 10-year horizon fixed. Green = above today's $15.31; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 5.8% | $23.55 | $25.94 | $29.07 | $33.30 | $39.38 |
| 6.8% | $18.56 | $19.98 | $21.72 | $23.92 | $26.79 |
| 7.8% | $15.16 | $16.07 | $17.15 | $18.45 | $20.05 |
| 8.8% | $12.70 | $13.31 | $14.02 | $14.85 | $15.84 |
| 9.8% | $10.83 | $11.26 | $11.75 | $12.32 | $12.97 |
About Vale S.A.
Operating globally and within Brazil, Vale S.A. is a major producer and seller of essential raw materials, including iron ore, iron ore pellets, nickel, and copper. Its operations are organized into two primary segments. The Iron Solutions segment is dedicated to the extraction and production of iron ore, pellets, and various other ferrous products, also providing crucial logistics services. Meanwhile, the Energy Transition Materials segment specializes in mining nickel, along with its valuable by-products such as gold, silver, cobalt, and other precious metals. This segment also handles copper, primarily used in construction for piping and electrical cables. Established in 1942, the company was formerly known as Companhia Vale do Rio Doce before officially rebranding as Vale S.A. in May 2009. Vale S.A. is headquartered in Rio De Janeiro, Brazil.
- Sector
- Basic Materials
- Industry
- Industrial Materials
- CEO
- Gustavo Duarte Pimenta