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1. Company Snapshot

1.a. Company Description

Friedman Industries, Incorporated engages in steel processing, pipe manufacturing and processing, and the steel and pipe distribution businesses the United States.It operates in two segments, Coil and Tubular.The Coil segment is involved in the conversion of steel coils into flat sheet and plate steel cut to customer specifications and reselling steel coils.


This segment also processes customer-owned coils on a fee basis.The company sells coil products and processing services to approximately 230 customers located primarily in the midwestern, southwestern and southeastern regions of the United States.Its principal customers for these products and services are steel distributors and customers manufacturing steel products, such as steel buildings, railroad cars, barges, tanks and containers, trailers, component parts and other fabricated steel products.


The Tubular segment manufactures line and oil country pipes, as well as pipes for structural applications.This segment sells its tubular products principally to steel and pipe distributors through its own sales force.Friedman Industries, Incorporated was incorporated in 1965 and is headquartered in Longview, Texas.

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1.b. Last Insights on FRD

Friedman Industries' recent struggles are driven by declining revenue and unprofitable operations, as seen in its Q3 fiscal 2025 earnings release. The company reported a loss, despite growing backlog, due to falling volumes and high costs. With a high P/E ratio and $120 million market cap, valuation is difficult to justify. Additionally, Friedman cannot cover interest costs at current volumes, although it has sufficient net working capital to avoid immediate financial issues.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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Comparing AB SKF (OTCMKTS:SKFRY) & Friedman Industries (NASDAQ:FRD)

Dec -02

Source: defenseworld.net

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Friedman Stock Declines Despite Strong Q2 Earnings and Century Deal

Nov -12

Source: zacks.com

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Friedman Industries, Incorporated Announces Second Quarter Results

Nov -10

Source: globenewswire.com

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Friedman Industries, Incorporated Announces Cash Dividend

Sep -18

Source: globenewswire.com

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Friedman Industries Stock Gains Following Strong Q1 Earnings Results

Aug -12

Source: zacks.com

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Friedman (FRD) Q1 Profit Jumps 92%

Aug -08

Source: fool.com

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Friedman Industries, Incorporated Announces First Quarter Results

Aug -07

Source: globenewswire.com

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Friedman Industries Appoints Gaurav Chhibbar as Chief Operating Officer

Jul -14

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.42%)

6. Segments

Coil

Expected Growth: 5.5%

Growing demand for industrial automation and increasing adoption of precision-wound coils in various industries, such as aerospace, automotive, and energy, drive the growth of The Coil from Friedman Industries, Incorporated.

Tubular

Expected Growth: 4.8%

Growing demand for oil and gas exploration and production, increasing adoption of high-strength steel tubing in drilling and extraction operations, and rising investments in energy infrastructure drive the growth of the tubular market.

7. Detailed Products

Tubular Products

Friedman Industries, Incorporated provides a wide range of tubular products, including oil country tubular goods (OCTG), line pipe, and standard pipe, used in the oil and gas industry for drilling, production, and transportation of oil and natural gas.

SBQ Products

The company offers special bar quality (SBQ) products, including alloy, stainless, and carbon steel bars, used in the manufacture of axles, gears, and other components for the automotive, construction, and industrial equipment industries.

Merchant Bar Products

Friedman Industries, Incorporated provides merchant bar products, including angles, channels, flats, and rounds, used in the construction, industrial, and manufacturing industries.

8. Friedman Industries, Incorporated's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Friedman Industries, Incorporated is moderate due to the availability of alternative products in the market.

Bargaining Power Of Customers

The bargaining power of customers is high due to the concentration of buyers in the market, giving them significant negotiating power.

Bargaining Power Of Suppliers

The bargaining power of suppliers is low due to the presence of multiple suppliers in the market, reducing their negotiating power.

Threat Of New Entrants

The threat of new entrants is moderate due to the moderate barriers to entry in the industry, making it possible for new companies to enter the market.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of several established companies in the market, leading to intense competition.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 22.35%
Debt Cost 8.82%
Equity Weight 77.65%
Equity Cost 10.64%
WACC 10.24%
Leverage 28.78%

11. Quality Control: Friedman Industries, Incorporated passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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A-Score: 4.4/10

Value: 7.2

Growth: 2.3

Quality: 5.2

Yield: 0.0

Momentum: 6.5

Volatility: 5.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

19.52$

Current Price

19.52$

Potential

-0.00%

Expected Cash-Flows