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U.S. Steel Corporation Delivered Strong 3Q17 Earnings

Mohit Oberoi, CFA - Author

Nov. 9 2017, Updated 3:15 p.m. ET

3Q17 earnings

U.S. Steel Corporation (X) released its 3Q17 earnings on October 31. The company generated revenues of $3.3 billion in 3Q17—compared to $3.1 billion in 2Q17 and $2.9 billion in 3Q16. U.S. Steel Corporation posted an adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) of $342 million in 3Q17. It posted an adjusted EBITDA of $362 million in 2Q17 and $272 million in 3Q16. Steel Dynamics (STLD), Nucor (NUE), and AK Steel (AKS) also posted sequentially lower EBITDA in 3Q17. U.S. Steel Corporation’s 3Q17 revenues and profits beat analysts’ estimates.

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According to the consensus estimates compiled by Thomson Reuters, U.S. Steel Corporation has a mean one-year target price of $31, which represents 13.7% upside over its closing price on November 8. In contrast, U.S. Steel Corporation carried a one-year target price of $28.36 on October 30—one day before its earnings release. U.S. Steel received a “strong buy” rating from three analysts, while five analysts rated the stock as a “buy.” Five analysts polled by Thomson Reuters on November 8 rated the stock as a “hold.” Two analysts rated U.S. Steel Corporation as a “sell.”

Cowen and Company upgraded U.S. Steel Corporation from “underperform” to “market perform” and raised its target price from $20 to $28 after its 3Q17 earnings. BMO also raised U.S. Steel Corporation’s target price from $29 to $33. However, JPMorgan Chase lowered U.S. Steel Corporation’s target price from $51 to $48.


While U.S. Steel Corporation’s 3Q17 earnings beat helped buoy sentiments (CLF), its better-than-expected guidance also provided fodder to bulls and the stock rose 7.8% on November 1. During its 3Q17 earnings presentation, U.S. Steel Corporation raised its 2017 net income guidance to $323 million from the previous guidance of $300 million.

Read A Deeper Dive into U.S. Steel’s 3Q17 Financial Performance for a detailed analysis of U.S. Steel Corporation’s 3Q17 earnings.


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