Graftech Q1 2022: Debt Deleveraging Continues, LTA Pricing Overhang An Issue

Equity Bottom-Up

252 Views, 09 May 2022 22:47

EXECUTIVE SUMMARY

GrafTech International Ltd (EAF US) reported solid results for Q1 2022. The stock still continues to look cheap at 4.7x FY22 PE.
The debt deleveraging target of 400 mn USD a year seems on track, and the company will be zero debt by FY23. FCF yield is 24% at the current price.
The company also bought back 30 mn USD of stock (3 mn shares @9.88 USD/share representing 1.1% of the outstanding shares) in Q1 2022.

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