Vale SA: Shares of 11.5%-Yielder Crushing S&P 500
December 15, 2025
VALE Stock Up 62% in 2025
In today’s income spotlight: Vale SA (NYSE:VALE).
One overlooked sector that has continued to perform exceptionally well in 2025 is basic materials, rising 30%. This is slightly less than the communication services sector, which is up 31.5%, and significantly higher than the so-called red-hot technology sector, which is up 24.8% in 2025.
Admittedly, basic materials doesn’t sound as exciting as technology or artificial intelligence, but without basic materials, we wouldn’t really have anything. It’s the first step in the supply chain, providing the basic materials that create a finished good.
The sector is essentially made up of companies engaged in the discovery, extraction, and processing of raw materials. This includes mining, forestry, and chemical production.
Vale SA: Keep an Eye on This Basic Materials Stock
That’s why it’s worth keeping Vale SA, a great basic materials stock that is also a leading metals and mining play, on your radar.
Vale, based in Rio de Janeiro, Brazil, is an industry juggernaut, with a market cap of $56.4 billion, up significantly from its $42.3 billion valuation when we last looked at the company in July.
It’s one of the world’s biggest miners of iron ore, nickel, and copper, which are used to produce steel and lithium batteries and for other widely used applications. Other metals mined by Vale include gold, silver, and cobalt. The company has extensive operations in Brazil, Oman, Canada, China, and Indonesia. (Source: “What we do,” Vale S.A., last accessed December 9, 2025.)
Vale is also engaged in greenfield mineral exploration in five countries and operates logistics systems in Brazil and other regions in the world, including railroads, maritime terminals, and ports.
Another Strong Quarter
Vale SA has increased its revenue significantly since the 2020 health crisis, from $39.5 billion to a record $54.5 billion in 2021. Revenues have been down over the last few years, with the trailing 12 months coming in at $37.4 billion.
Wall Street anticipates that 2025 revenue will come in at $37.8 billion and rise to almost $40.0 billion in 2026.
Vale has been having a solid 2025, reporting robust sales performance across all of its business segments. Iron ore, copper, and nickel sales increased by five percent, 20%, and six percent, respectively, supported by solid operational performance. (Source: “3Q2025 Quarterly Results,” Vale SA, October 30, 2025.)
The company’s total third-quarter net operating revenue increased nine percent on an annual basis to $10.4 billion. Net income increased to $2.6 billion, with free cash flow (FCF) up 337% at $2.5 billion and recurring FCF rising more than 200% to $1.5 billion.
Its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) climbed 21% to $4.3 billion. Adjusted operating income advanced 26% to $3.6 billion.
Vale ended the third quarter with cash and cash equivalents of around $5.9 billion, up from $4.58 billion in the third quarter of 2024 and $3.79 billion at the end of 2024.
Commenting on the third-quarter results, Gustavo Pimenta, Vale’s chief executive officer, said, “We delivered another strong quarter, marked by solid operational performance. Iron ore production reached its highest quarterly level since 2018 and copper had its best Q3 result since 2019, while we continued to improve our cost competitiveness on nickel.”
Special Dividend of $0.66/Share
Thanks to its robust FCF, Vale is able to provide shareholders with a big dividend. It should be noted that its policy is to pay out 30% of EBITDA minus current investments. As a result, VALE stock’s payout will fluctuate. The company also pays out a semi-annual dividend.
In March, it paid a dividend of $0.37 per share. In August, VALE paid a dividend of approximately $0.35 per share.
In November, Vale announced a special dividend. The company’s board approved a special dividend of 3.58 Brazilian reais per share, to be distributed in installments in January and March of next year. At current prices, this works out to roughly $0.66 per share.
The total payout of 15.3 billion reais (approximately USD$2.9 billion) is pretty much in line with Vale’s third-quarter net income.
The special dividend is a result of strong iron ore prices, which are above $100.00 per ton. This has resulted in robust cash flow, which has surpassed guidance set earlier this year.
VALE Shares Crushing the Broader Market
Strong financial results and a special dividend are helping juice VALE stock considerably higher. When we last looked at VALE in July, it was trading at $9.91 per share. On December 4, the stock hit a new 52-week high of $13.62 per share. It continues to trade near that level.
VALE stock is currently up:
- 25% over the last three months
- 44% over the last six months
- 62% year to date
- 48% year over year
Chart courtesy of StockCharts.com
The Lowdown on Vale SA
Vale SA is a basic materials giant with diversified operations and a big global footprint. The company’s reporting solid financial results, and it could do even better once the global economy improves.
Stronger results should, of course, lead to higher profitability and FCF, which ought to result in higher dividend payouts. Thanks to strong iron ore prices, Vale recently announced a special dividend that will be paid out in January and March 2026.
