Century Aluminum Company Common Stock (CENX) fair value

ACCE thesis

Century Aluminum smelts primary aluminum at its own plants, including the Mt. Holly smelter in South Carolina and the Hawesville and Ravenswood facilities, and sells it into North American transport, packaging and building markets, with a portion of output tied to the regional Midwest premium. The company's edge is structural: its US smelting capacity sits behind tariff protection and a domestic price premium that imports have to clear, and the 2024 restart of previously idled Ravenswood capacity, following a power supply agreement, adds volume the market has not fully priced. Revenue growth of 19.7% and an operating margin of 28.1% show the leverage to aluminum prices and the Midwest premium at work, while the 5.9x trailing and 6.5x forward P/E suggests investors are still treating the cash flows as cyclical rather than durable. The obvious risks are that the premium and tariff regime can change with a single policy decision, and that an 18.9% gross margin leaves little room if power costs or alumina prices move against the company. Worth a deeper look to test how much of current earnings depends on the tariff-supported premium staying intact.