AAPL 165.84 0.5091% MSFT 400.96 0.461% GOOG 157.95 1.4321% GOOGL 156.28 1.4212% AMZN 177.23 1.4889% NVDA 795.18 4.3543% META 481.73 0.1372% TSLA 142.05 -3.4002% TSM 129.75 1.6053% LLY 731.33 0.6912% V 272.33 0.9452% AVGO 1224.46 1.6394% JPM 189.41 1.9429% UNH 491.23 -1.9755% NVO 125.26 2.0781% WMT 60.14 1.0247% LVMUY 168.89 0.4222% XOM 120.57 0.5756% LVMHF 851.89 0.4528% MA 456.75 0.2986%

Global Fully Charged Report

GrafTech International Limited

Apr 26, 2022

Investment Type
Mid - Cap
Risk Level
Rec. Price ($)


Company Overview: GrafTech International Limited (NYSE: EAF) manufactures graphite electrode products essential to producing electric arc furnace steel and other ferrous and non-ferrous metals. It has access to low-cost manufacturing facilities, including three high-capacity facilities.

­­­­­­EAF Details

Material Business Updates

Historical Financial Trend:

EAF illustrated robust topline growth until FY20 when COVID-19 disruptions substantially struck the steel industry. The revenues have demonstrated substantial growth with a CAGR of 25.0% (FY17 – FY21).

Full-Year FY20 Performance:

Top 10 Shareholders:

The top 10 shareholders together form ~56.55% of the total shareholding. Brookfield Asset Management, Inc. and The Vanguard Group, Inc. hold a maximum stake in the company at ~­­­24.49% and ~8.68%, respectively.

Key Metrics:

Consistent sales and production volume growth has translated into long-term sustainable growth levels. Despite short-term disruptions in FY20, EAF demonstrated substantial operational efficiency, warranted by steady growth in gross margins. The company managed a stable current ratio in FY20 over the prior year on liquidity.


Key Risks:

Graphite Pricing Impact: The potential overcapacity in global graphite electrodes, coupled with cyclical pricing of graphite electrodes, may adversely affect international pricing.

High Dependence: EAF is highly dependent on electric arc furnace steelmaking within the steel industry, which depends on the supply of petroleum needle coke and energy.

Valuation Methodology: EV/Sales Multiple Based Relative Valuation (Illustrative)

Stock Recommendation:

EAF has delivered 3-month and 6-month returns of ~-11.11% and ~-14.8%, respectively. The stock is trading below the average of the 52-week low price of US$9.11 and the 52-week high price of US$14.16, indicating an accumulating opportunity. The stock has been valued using the EV/Sales multiple-based illustrative relative valuation method and arrived at a target price with an upside of low double-digit (in % terms). The company might trade at a slight premium compared to its peers’ average EV/Sales (NTM trading multiple), considering favourable steel industry prospects and improved sales volumes. For valuation, a few peers like Emerson Electric Co (NYSE: EMR), Hubbell Inc (NYSE: HUBB), Regal Rexnord Corp (NASDAQ: RRX), and others have been considered. Given the robust demand for electric arc furnace steelmaking, operational improvements, favourable guidance on LTA volume and LTA sales, potential upside as indicated by the valuation, and associated key business risks, we give a “Buy” recommendation on the stock at the closing market price of US$9.52, up by 0.95%, as of 26 April 2022.

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

EAF Daily Technical Chart (Source: REFINITIV)

Note 1: The reference data in this report has been partly sourced from REFINITIV

Note 2: Investment decisions should be made depending on the investors’ appetite for upside potential, risks, holding duration, and previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the analysis has been achieved and subject to the factors discussed above alongside support levels provided.

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

Disclaimer - This report has been issued by Kalkine Pty Limited (ABN 34 154 808 312) (Australian financial services licence number 425376) (“Kalkine”) and prepared by Kalkine and its related bodies corporate authorised to provide general financial product advice. Kalkine.com.au and associated pages are published by Kalkine.

Any advice provided in this report is general advice only and does not take into account your objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your objectives, financial situation and needs before acting upon it.

There may be a Product Disclosure Statement, Information Statement or other offer document for the securities or other financial products referred to in Kalkine reports. You should obtain a copy of the relevant Product Disclosure Statement, Information Statement or offer document and consider the statement or document before making any decision about whether to acquire the security or product.

You should also seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice in this report or on the Kalkine website. Not all investments are appropriate for all people.

The information in this report and on the Kalkine website has been prepared from a wide variety of sources, which Kalkine, to the best of its knowledge and belief, considers accurate. Kalkine has made every effort to ensure the reliability of information contained in its reports, newsletters and websites. All information represents our views at the date of publication and may change without notice.

Kalkine does not guarantee the performance of, or returns on, any investment. To the extent permitted by law, Kalkine excludes all liability for any loss or damage arising from the use of this report, the Kalkine website and any information published on the Kalkine website (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine hereby limits its liability, to the extent permitted by law, to the resupply of services.

Please also read our Terms & Conditions and Financial Services Guide for further information.

On the date of publishing this report (referred to on the Kalkine website), employees and/or associates of Kalkine and its related entities do not hold interests in any of the securities or other financial products covered on the Kalkine website unless those persons comply with certain safeguards, procedures, and disclosures.

Kalkine Media Pty Ltd, an affiliate of Kalkine Pty Ltd, may have received, or be entitled to receive, financial consideration in connection with providing information about certain entity(s) covered on its website.


Kalkine Equities LLC provides general information about companies and their securities. The information contained in the reports, including any recommendations regarding the value of or transactions in any securities, does not take into account any of your investment objectives, financial situation or needs. Kalkine Equities LLC is not registered as an investment adviser in the U.S. with either the federal or state government. Before you make a decision about whether to invest in any securities, you should take into account your own objectives, financial situation and needs and seek independent financial advice. All information in our reports represents our views as at the date of publication and may change without notice.

Kalkine Media LLC, an affiliate of Kalkine Equities LLC, may have received, or be entitled to receive, financial consideration in connection with providing information about certain entity(s) covered on its website.