Why the capacity utilization rate came down at Steel Dynamics
One of the key metrics in the steel industry is the capacity utilization rate. It represents the actual production compared to the maximum possible production.
AK Steel Could Face Challenges in Meeting Its Goals
AK Steel is working towards stable margins throughout the business cycle. AK Steel has deliberately lowered its exposure to spot markets (X) (CLF).
Steel Imports Reach Record Levels In October
Compared to the first ten months of last year, steel imports are up by more than 35%. This is an alarming situation.
Your Key Steel Events to Follow This Week
China’s October fixed asset investment, real estate investment, and industrial production data are all expected to be released on November 14.
Must-know: Key risks that AK Steel investors face
The increased use of aluminum in vehicles is a threat for AK Steel (AKS). The automotive industry accounts for ~26% of steel consumption in the U.S.
What Weighed down AK Steel’s 3Q17 Performance?
AK Steel (AKS) reported adjusted EBITDA of $69.2 million in 3Q17, compared with $142 million in 2Q17 and $157 million in 3Q16.
Nucor Looks to Contract Resets to Further Improve Performance
Nucor (NUE) expects its 3Q16 performance to improve as compared to 2Q16. The key driver of Nucor’s 3Q16 performance would be the reset of contracts.
U.S. Steel Faces A Tough Year With Rig Counts On A Downward Spiral
Let’s first consider why investors should monitor rig counts. Well, rig counts tell you how many rigs are currently active for drilling.
Why the outlook for US Steel’s tubular goods is positive
With the recent imposition of anti-dumping duties, imports of tubular goods will likely decrease, helping U.S. Steel’s revenue in the tubular segment to increase.
Inside AK Steel’s Valuation: Analyzing 2018 Drivers
U.S. Steel (X) has the lowest forward valuation multiple in our coverage of steel stocks. The stock is trading at 4.97x its 2018 consensus EBITDA.
Key takeaways from Nucor’s 3Q14 cost structure
Due to an increase in electricity costs, Nucor’s energy cost per ton of steel in 3Q14 went up by almost $1 from the corresponding quarter last year.
It’s Raining Cash for U.S. Steel amid Strong Markets
AK Steel (AKS) generated free cash flow of $147.0 million in 2Q17 compared to $3.8 million in 1Q17. It generated free cash flow of $111.0 million in 2Q16.
Can U.S. Steel’s Asset Revitalization Plan Spark Its Stock?
U.S. Steel (X) expects its slab production capacity to increase by 1.0 million tons by 2020 from the current level of 10.0 million tons.
Why US Steel Companies Could Benefit from Lag Pricing in 4Q16
Steel companies such as U.S. Steel (X), Nucor (NUE), and ArcelorMittal (MT) sell their products in the spot market or under contract sales.
US Steel in Q2 2018: Guidance, Analysts’ Actions, and Trump
Despite President Trump’s tariffs on imported steel, US steel stocks—with the exception of Steel Dynamics—have sagged this year.
ArcelorMittal’s 4Q17 Earnings versus U.S. Steel
Previously in this series, we’ve compared steel companies’ 4Q17 shipments and average selling prices (or ASPs).
Germany Helps Eurozone Business Activity Rise in August
Both the manufacturing and service sector contributed positively to business activity growth in Germany in August.
Outlook for Chinese Steel: Implications for US Steel
China is the world’s largest steel consumer, steel producer, and steel exporter. It dominates the global steel markets probably like no other country ever has.
Chinese Steel Production: Will We See Curtailments This Year?
Previously in this series, we looked at China’s steel demand indicators. It’s also important for investors to look at the supply side of the equation.
Can Falling Scrap Prices Drive US Steel Prices Lower?
Integrated miners like U.S. Steel and ArcelorMittal use primarily iron ore, whereas minimills like Nucor and Steel Dynamics rely more on steel scrap.
What Could Do the Trick for US Steel Prices
Bank of America Merrill Lynch has raised its 2017 hot rolled coil steel forecast to $700 per ton. The brokerage also upgraded U.S. Steel (X) from a “neutral” to “buy.”
These Factors Could Drive Cleveland-Cliffs’ Valuation in 2018
Among the US steel and iron ore peers, Nucor (NUE) is trading at the highest forward multiple of 7.7x.
What Do Current Market Dynamics Suggest for U.S. Steel’s Guidance?
Despite its cost headwinds, U.S. Steel (X) expects to post EBITDA of $1.3 billion in 2017.
January Steel Imports: Should We Cheer or Worry?
Steel executives have been regularly blaming the steep rise in US steel imports as the main reason for their woes. Last year, three companies presented their cases before members of Congress.
Must-know: The biggest risk US steel companies face
Strong steel demand should turn into higher revenues for U.S. steel companies. However, rising imports have impacted steel demand.
These Factors Could Impact CLF’s US Volumes in 3Q17 and Beyond
In 2Q17, Cleveland-Cliffs (CLF) achieved 4% growth year-over-year in US volumes to 4.3 million tons.
Solid performance of U.S. Steel’s flat-rolled segment
The increase in U.S. Steel’s profits at the flat-rolled segment was due primarily to Carnegie Way benefits. The company is expected to operate at higher utilization levels in the coming quarters. This is a positive sign for U.S. Steel (X) investors.
AK Steel Hovers above 2015 Lows: Still among Steel’s Worst
AK Steel (AKS) is still marginally above its 2015 lows. But it’s still among the worst performing steel companies in 2015.
Can AK Steel’s Second-Quarter Earnings Call Reassure Investors?
During AK Steel’s second-quarter earnings call, analysts could be closely watching the company’s ASP (average selling price) guidance.
US Steel Demand: 2018 Could Be a Strong Year
If the Trump administration moves forward on the proposed infrastructure investments, it could boost US steel demand.
Overview: US Steel’s performance versus its peers
Lower margins are a reflection of the efficiency of a company.
What Could Lift U.S. Steel Corporation Stock from Its Slump?
Although global steel prices have weakened this year, steel bulls expect the probe into steel imports to provide some sort of relief for US steel plays.
Must-know: Does the slowdown in Europe impact your investments?
The GDP figures in the second quarter raised fears about the European Union’s sustainability growth. The ECB recognized the severity of the situation.
Weekly Roundup: Steel Stocks Saw Their Fortunes Reverse
Last week was mixed for steel stocks—they followed different trajectories. With gains of 6.6%, AK Steel (AKS) was the biggest gainer.
United States Steel: 1Q17 Was Terrible, but Could 2Q17 Be Better?
Analysts expect United States Steel to post revenues of $2.98 billion in 2Q17. It posted revenues of $2.72 billion in 1Q17 and $2.58 billion in 2Q16.
Steel Stocks Recoup Losses after MT’s Earnings Lift Sentiments
Last week started on a positive note for most steel stocks, with most seeing upward price action on Monday. But sentiments were mostly negative after that.
Should the Fall in Chinese Steel Prices Worry AK Steel?
China is the world’s largest steel producer, consumer, and exporter. Last year, we saw a steep rally in Chinese steel prices.
Why the Chinese slowdown concerns steel plays the most
China is the biggest steel consumer. It accounts for almost half of global steel consumption. The slowdown in Chinese steel consumption isn’t a healthy sign for global steel markets.
Why Is Cliffs Going to Idle Iron Ore Pellet Production?
Cliffs announced that it is going to temporarily idle its iron ore pellet production at its Northshore Mining operation in Minnesota by December 1, 2015.
US Steel to China: Where Are the Capacity Cuts?
Earlier this year, China announced capacity cuts in order to curtail its excess steel. The same commitment has been reiterated by China several times.
U.S. Steel Might Need to Do Some Firefighting Today
U.S. Steel Corporation (X) released its 1Q18 earnings results yesterday. While the company’s earnings beat analysts’ estimates, its 2018 guidance seems to have spooked markets.
Why U.S. Steel Investors Should Brace for Higher Input Costs
U.S. Steel Corporation (X) produces steel in blast furnaces and uses coking coal and iron ore (CLF) as raw material.
Must-Know: US HRC-CRC Spread Widens to Record Highs
During its 2Q16 call, AK Steel (AKS) pointed to a “significant rise” in CRC steel imports from Turkey, Vietnam, and Australia.
Falling Car Sales and Waning Trump Effect Spell Trouble for AKS
AK Steel (AKS) has been among the worst-performing steel stocks (MT) (STLD) in 2017 with year-to-date losses of more than 46% as of May 17.
US Steel Mills Maintain Supply Discipline: Will It Help?
According to data released by the American Iron and Steel Institute, US steel production fell 4.9% YoY (year-over-year) in the week ended September 24, 2016.
Multiyear Low US Steel Prices are Not Helping Matters for Cliffs
Most of Cliffs Natural Resources’ revenues and earnings are tied to the US steel industry. Steel prices are also a component of Cliffs’ pricing formula.
AK Steel’s 1Q17 Earnings Call: What Really Spooked Investors
AK Steel expects its 2Q17 average selling prices to be “marginally higher” compared to 1Q17. However, AK Steel could witness higher costs in 2Q17.
How Do US Steel Industry Indicators Look amid 3Q16 Earnings?
By analyzing how steel industry indicators are shaping up, you can get a sense of how steel companies could perform beyond the current quarter.
Cliffs’ US Realized Prices Have Ample Upside in 2017. Here’s Why
Cliffs Natural Resources’ average realized prices were 0.5% lower YoY in 4Q16 at $73.8 per ton.
What Can Investors Expect from Steel Companies’ 2Q15 Earnings?
AK Steel and U.S. Steel are expected to post a loss in 2Q15. U.S. Steel’s earnings have been hit because its tubular segment hasn’t been doing well.
How Will Steel Prices in the US Impact Cliffs’ Realized Revenues?
US steel has seen a change in fortunes this year. Trump’s win has been a positive catalyst for the industry.
Revisiting the Case: How Does Cleveland-Cliffs Look Now?
Cleveland-Cliffs (CLF) has witnessed a turnaround of sorts in the last four years.
Deflation Continues in the Eurozone: VGK Down 1.43%
Consumer prices in the Eurozone remain in negative territory. Inflation was reported to be -0.1% in March. So, the Eurozone remains in a state of deflation.
What to Watch for in ArcelorMittal’s 3Q16 Earnings Call
During the 3Q16 earnings call, markets will wait for updates from ArcelorMittal on its negotiations with automotive customers.
Cliffs Natural Resources’ US Volumes: Will There Be a Surprise?
On June 9, 2016, Cliffs announced that it will be reopening its United Taconite plant in northeastern Minnesota two months early due to a contract with U.S. Steel Canada.
Analysts Maintain the Status Quo on Steel Stocks
Overall, the third quarter has been a subdued earnings season for steel companies (SPY). Nucor’s earnings fell short of analysts’ expectations.
Can ArcelorMittal’s 3Q17 Earnings Boost Steel Market Sentiments?
AK Steel (AKS), which released its earnings on October 31, fell 21.5% after its 3Q17 earnings release.
ArcelorMittal’s Key Risks in 2H15: Investor Must-Knows
ArcelorMittal faces certain macro risks. We’ll discuss these risks in this part of our series.
Europe’s Stagnant Industrial Production Impacts ArcelorMittal
The industrial production has been stagnant for several quarters now. The slowdown in Europe also impacts mining giants like Rio Tinto (RIO) and BHP Billiton (BHP).
Must-know: Why did the Indian rupee free-fall in 2013?
India’s current account deficit rose to 4.8% of GDP in 2012–2013, largely financed through hot money flows, and exceeded the government’s target level of 2.5% to 3% of GDP.
U.S. Steel Corporation: Its Earnings Beat Might Impress You
U.S. Steel Corporation (X) released its second-quarter earnings on August 1 after the market closed. Its revenues were $3.6 billion.
Inside Cliff’s Earnings in 2017: What Will Drive Analysts’ Earnings Estimates?
In the past year, analysts have raised their revenue projections for Cliffs from ~$1.8 billion to ~$2.0 billion for the year.
Why investors need to understand the correction in metal shares
Metal shares have had a dream run since mid-2013. Specifically, steel companies’ shares have been defying all the laws of gravity.
Will Falling Steel Production in Europe Affect ArcelorMittal?
The EU saw the biggest decline in steel production in February as compared to other major steel-producing countries.
Why ArcelorMittal Stock Is Popular among Analysts
On July 6, Macquarie initiated coverage on ArcelorMittal with a “outperform” rating and target price of 30 euros.
How U.S. Steel’s 2Q17 Performance Stacks Up against Its Peers
It’s been a mixed earnings season for steel investors. Nucor and Steel Dynamics missed consensus earnings estimates. AK Steel and U.S. Steel posted better-than-expected earnings.
How Bond Buybacks Add Value
As of June 30, 11 fallen angel companies had issued tender offers YTD, boosting their bond prices by 5% on average.
Why Investors Shouldn’t Fret over MT’s Negative Free Cash Flow
In this article, we’ll look at ArcelorMittal’s 1Q17 cash flow and leverage positions. As of the end of 1Q17, ArcelorMittal had net debt of $12.1 billion.
Iron Ore and Steel Scrap Prices Diverge after Section 232 Tariffs
Iron ore and steel scrap are the key steelmaking raw materials. In the United States, steel prices and scrap prices tend to move in tandem.
What’s the Real Issue Plaguing the US Steel Industry?
The US steel industry (X) (AKS) (NUE) lists “unfairly traded steel products” as its biggest woe.
How Does Cliffs’s Competition Look Post-ArcelorMittal Contract?
Cliffs Natural Resources (CLF) is the largest and lowest-cost supplier of iron ore pellets in the United States.
3 Things That Will Affect Steel Imports In 2015
The growth in steel imports in 2015 could be less spectacular. There are several reasons for this outlook. Let’s discuss them in detail.
Must-know: Why steel companies are celebrating
While the Christmas season is still months away, steel companies have other reasons to celebrate. The steel sector has seen a lot of positive news over the past several months.
Behind ArcelorMittal’s 1Q17 Call: What the Market Is Eager to Hear
During its 1Q17 earnings call, the market will look for ArcelorMittal’s commentary on the steel price outlook.
How Analysts Are Rating ArcelorMittal Ahead of Its 2Q17 Results
ArcelorMittal’s 2Q17 earnings ArcelorMittal (MT), the world’s largest steelmaker, is scheduled to release its 2Q17 earnings on July 27. Analysts polled by Thomson Reuters expect the company to post revenue of $17.4 billion in 2Q17. ArcelorMittal posted revenue of $16.0 billion in 1Q17 and $14.7 billion in 2Q16. ArcelorMittal’s 2Q17 EBITDA (earnings before interest, tax, […]
U.S. Steel Corporation’s 1st-Quarter Conundrum Continues
U.S. Steel Corporation released its 1Q18 results yesterday after markets closed.
What Analysts See in Cliffs Natural Resources under Trump’s Presidency
US steel prices and order books for customers are the major revenue drivers for Cliffs Natural Resources’s (CLF) US division.
ArcelorMittal’s 3Q16 Earnings: What’s the Word on Wall Street?
ArcelorMittal (MT), the world’s largest steelmaker, will release its 3Q16 earnings on November 8. It has been a remarkable year for the company.
What to Watch for in U.S. Steel’s 4Q16 Earnings Call
During U.S. Steel’s 4Q16 earnings call, markets would expect more updates from the company regarding its 2017 coal contracts.
Europe’s Manufacturing PMI Is Steady in April: Signals Recovery
In April, the Eurozone’s PMI was 52—down from 52.2 in March. However, Europe’s manufacturing PMI held above 50 for almost two years.
Wall Street’s Steel View: Which Steel Stocks Analysts Are Eyeing
U.S. Steel (X) has received a “buy” rating from 51% of its analysts, while 13% analyst recommend a “sell.”
How Does ArcelorMittal’s Valuation Look ahead of 2Q17 Earnings?
In this article, we’ll look at ArcelorMittal’s (MT) valuation multiples ahead of its 2Q17 earnings.
Can ArcelorMittal match U.S. Steel Corporation’s performance?
U.S. Steel has almost identical problems as ArcelorMittal. Both had production through blast furnace routes, had high leverage ratios, and had their own iron ore mining.
Understanding Cliffs’ New Estimates: Why Are Iron Ore Analysts Second-Guessing?
Most of Cliffs Natural Resources’ (CLF) revenues and earnings are derived from its US steel division. This makes its drivers unique among peers.
Does U.S. Steel’s Turnaround Look Real This Time?
China exported 8.1 million metric tons of steel in November 2016, a fall of 16.0% YoY (year-over-year). Its exports fell 14.6% YoY in October.
3Q16 Earnings: Are Analysts Losing Patience with U.S. Steel?
3Q16 earnings Wall Street analysts update their target prices after a company’s quarterly earnings release. After U.S. Steel Corporation’s (X) 3Q16 earnings release, several leading brokerages slashed the company’s target price. Target price cut For instance, Credit Suisse, which was among the bullish brokerages on U.S. Steel, cut the company’s target price from $29 to […]
US Steel Industry’s Woes Are Far from Over
Most steel stocks continue to trade near 52-week lows. U.S. Steel Corporation (X) has fallen more than 70% year-to-date.
Does U.S. Steel Look Oversold after the Recent Sell-Off?
Based on its September 16, 2016, closing price, U.S. Steel has a 14-day RSI of 27.5, which means it looks oversold, similar to other US steelmakers.
How Do Falling US Steel Imports Impact Cliffs’ US Volumes?
Cliffs CEO Laurenco Goncalves mentioned during the Goldman Sachs conference on November 16 that the percentage of domestic steel on the market is ~70%.
How’s the Raw Material Market Impacting Steel Prices in 2016?
Steel production is raw material–intensive in nature. Iron ore, steel scrap, and coking coal are the key raw materials that go into steel production.
What Can U.S. Steel Investors Expect in 2017?
U.S. Steel (X) and other steelmakers like AK Steel (AKS), Nucor (NUE), and Steel Dynamics (STLD) have seen significant upwards price movements over the last couple of months.
Is There a Disconnect between CLF’s Valuation and Fundamentals?
In this part of the series, we’ll look at Cleveland-Cliffs’s (CLF) valuation and compare it to its US steel peers.
Declining US Steel Production is Hurting Cliffs
US steel production trends are a good indicator of the health of Cliffs and other integrated iron ore producers in the United States.
Must know: Steel companies are bracing for aluminum onslaught
According to estimates, producing aluminum auto bodies raises the price of vehicles by more than $1, 000 per unit. Regardless, it’s expected aluminum use in auto bodies will increase tenfold by 2025.
What Cliffs Natural Resources’ Debt Tender Offer Means
On July 31, 2017, Cliffs Natural Resources (CLF) announced a tender offer for a $575.0 million aggregate principal amount of its 5.75% guaranteed notes due in 2025.
How ArcelorMittal Fared in 1Q18
ArcelorMittal (MT), the world’s largest steel producer, reported revenues of $19.2 billion for 1Q18, the highest since 3Q14.
Are aluminum vehicles really good for the environment?
According to the steel industry, aluminum production is energy intensive. As a result, it isn’t an environmentally-friendly metal—like it’s made out to be.
Behind Analyst Ratings for AK Steel after 1Q16
There have been no major changes in analyst recommendations AK Steel after its 1Q16 earnings release. But some raised their target prices.
Why ArcelorMittal could also be an iron ore play
According to analysts’ estimates, many iron ore mining operations won’t be viable if iron ore prices fall another 10%. This will drive producers away from the market.
Beneath the Sagging Auto Demand—And Its Impact on Iron Ore Prices
Vehicle sales in China, including trucks and buses, fell 2.2% YoY (year-over-year) to 2.1 million in April 2017.