Vallourec [VK]

Vallourec is a French manufacturing company specialising in tubing, tubing technology, automotive parts, and stainless steel.

Founded in 1931, the company’s headquarters are in Meudon, France. Vallourec is a multinational company with presence in more than 20 countries and manufacturing facilities in more than 50.

Vallourec was formed due to a commercial partnership between the factories in three French cities: Valenciennes, Louvroil and Recquignies. Following several mergers in the French manufacturing industry in the 1950s, Vallourec became the second largest steel tube manufacturer in France. Throughout the 1950s, 1960s, and 1970s, Vallourec continued to grow both nationally and internationally by increasing its manufacturing capacity and acquiring related companies.

Vallourec has expanded its geographical footprint and the industries it supports. In September 2005, Vallourec acquired OMSCO, an American company, making it the world’s second-largest manufacturer of oil drilling pipes. Since then, the company has further developed its oil and gas business, particularly in China and the Middle East.

Overall, Vallourec supplies its products to the following industries: oil and gas, electrical, petrochemical, mechanical, and automotive. As of 2022, its oil and gas business produces the majority of its revenue, 61.9%. This is followed by mechanical and automotive sales (25.5%), and all other industries combined generate the remaining 12.6%.

In 2022, Vallourec’s oil and gas business in North America has grown significantly, and it is focusing on profitability throughout all of its business lines. Asia is responsible for 27.8% of its sales, followed by South America (23.3%), North America (22.2%), Europe (16.4%), and other regions (10.3%).

Vallourec Stock History

Vallourec stock (EPA: VK) is traded publicly on the NYSE Euronext exchange and first started trading on the Paris Stock Exchange in 1957. As of May 2022, the company’s market cap stood at €2.709 billion, with a 52-week high of €14.50 per share and a 52-week low of €6.00 per share.

The VK stock split seven times between 2005 and 2022, one of those being a reverse split. The table below shows each split and when it occurred:

The reverse stock split that occurred on May 25, 2020, exchanged 40 existing shares for one new share of Vallourec stock. However, it’s important to note that this reverse split was only a technical adjustment and did not impact the value of the shares held.

In terms of dividends, the company does issue yearly dividends as long as the board of directors approves it. No dividends were issued between 2015 and 2021. The dividend approved in 2015 was €0.81 per share. The highest dividend paid out occurred in 2006 – €7.20 per share.

Looking more closely at share price fluctuations, VK stock has experienced both upward and downward trends between 2017 and 2022. The lowest share price reached during this period was €4.04 on October 29, 2020.

The stock rebounded though and traded at €11.87 on May 5, 2022, a 98% increase. Of particular note is that Vallourec stock’s trading volume has increased during this same period, particularly in the 4th quarter of 2021.

How to Trade VK Stock

There are several factors to consider when trading VK stock. One crucial factor that can influence the share price is new regulatory regimes in Vallourec’s markets and the prices of commodities like crude oil and natural gas.

Regulations that impose taxes, quotas, or limitations on Vallourec or its customers could impact the price of its shares. Similarly, oil and gas prices can also affect its share price. In its Fiscal Year 2021 report, the company noted that higher oil prices positively impact its operations and create favourable conditions.

Another factor to be aware of is Vallourec’s general economic conditions, such as Asia and North America. For example, inflation in North America rose in 2021 and increased operating and production costs for the company. While inflation offsets positive price movements in the short term, it will also support higher product prices in the future.

Sustainability is also an essential factor in all industries Vallourec supports, particularly in oil and gas. Companies that focus on sustainability may explore new growth opportunities in the future, which is precisely what Vallourec is working towards.

In 2021’s Vallourec news, the company stated that it had added high-level Environmental, Social, and Governance (ESG) ratings to its audits, differentiating the company from its peers and paving the way for future expansion.

Vallourec Competition

Vallourec’s top competitors include Zekelman, United States Steel, TMK, and Tenaris. Zekelman and TMK are privately-held companies, while the others are publicly traded. Tenaris has the highest valuation of the publicly traded companies as of 2022, sitting at €17.75 billion.

Vallourec Periodic Earnings

Vallourec reports its earnings quarterly each year, and its fiscal year runs from January to December. Dividends are approved in May of each year and typically paid out in June if the company approves a payout.

Why Trade VK Stock with Avatrade

There are many reasons why you should consider trading stocks via CFDs with Avatrade.

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** Disclaimer –While due research has been undertaken to compile the above content, it remains an informational and educational piece only. None of the content provided constitutes any form of investment advice.

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