Nov. 4, 2014, 1:19 PM
- AK Steel (AKS -14.2%) is sharply lower despite reporting Q3 results that beat expectations, as investors appear to focus on a planned outage at one of its blast furnaces that is being pulled up into Q4 after originally being planned for 2015.
- While not providing specific Q4 guidance, AKS said Q4 results will be affected by the outage at its Ashland Works blast furnace which began in late October and should last ~28 days; the outage was advanced to Q4 from 2015 to fully address operational issues that began earlier this year.
- On its earnings conference call, AKS said Q3 was the company's best overall quarterly performance in five years; the higher EPS was helped by increased shipments as well as lower raw material and energy costs, and the automotive business enjoyed its best quarter since Q1 2006 (Briefing.com).
Nov. 4, 2014, 8:35 AM
Nov. 3, 2014, 5:30 PM
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Oct. 29, 2014, 9:15 AM
Oct. 28, 2014, 7:15 PM
Oct. 28, 2014, 5:48 PM
Oct. 23, 2014, 4:52 PM
- The U.S. will not move forward with planned import duties on specialized steel from China, South Korea, Russia and other countries after the U.S. International Trade Commission found the imports were not harming local industry.
- Imports of grain-oriented electrical steel from China had faced the prospect of the highest duties after an earlier Commerce Department determination that they were being sold in the U.S. too cheaply and were being produced using unfair government subsidies.
- AK Steel (NYSE:AKS) and Allegheny Tech (NYSE:ATI), who had lodged the complaints, say they will appeal USITC decision.
Oct. 21, 2014, 12:34 PM
- The U.S. says it will terminate a 15-year-old deal sheltering Russian flat-rolled steel producers from high import duties, and anti-dumping duties will apply beginning Dec. 16.
- U.S. steel producers, including U.S. Steel (X +5%) and Nucor (NUE +2.2%), complained to the Commerce Department in July that the reference price set in a 1999 agreement, which also set a cap on imports, had been below U.S. market prices since 2004.
- However, J.P. Morgan analysts see no reason for buying steel stocks (NYSEARCA:SLX), saying the move impacts only 1.4% of U.S. market share; in fact, the firm suggests shorting steel stocks on the "misinterpretation" of duties on Russian imports of hot rolled steel.
- Other steels also are higher: AKS +3.9%, MT +3.6%, CMC +2.3%, STLD +1.7%.
Oct. 17, 2014, 11:47 AM
- AK Steel (AKS +11.2%) surges after Nomura upgrades shares to Buy from Neutral and raises its price target to $10 from $7, citing $2 of EPS power by 2016.
- Nomura foresees a material increase in EBITDA and free cash flow for AKS in 2015, owing to significant raw material cost down, accretion from the Dearborn acquisition, improvements in electrical steel markets, higher automotive margins, elimination of substantial weather and outage costs from 2014.
- The firm forecasts 2015 EBITDA of $795M vs. the consensus estimate of $697M and free cash flow of $1.95/share, and sees 2016 EBITDA of $856M and free cash flow of $2.57/share, thanks to additional synergies at Dearborn, further declines in ore prices, and a full-year of contribution from Magnetation.
Oct. 17, 2014, 9:20 AM
Oct. 2, 2014, 12:47 PM
- AK Steel (AKS +1.6%) is upgraded to Buy from Hold at Deutsche Bank on valuation in the wake of a 28% stock correction since Sept. 17.
- The firm sees AKS as the main beneficiary of lower iron ore prices, and notes that AKS has just completed its Severstal Dearborn acquisition which should improve scale/operational flexibility; also, the Magnetation pellet plant started operations three months ahead of schedule and is expected to provide iron ore pellets at a discount to market price.
Sep. 18, 2014, 3:21 PM
- In the doldrums not long ago, steel stocks are now among the hottest in the market; in the last three months, X +81%, STLD +37%, AKS +30%, NUE +12%.
- Steel Dynamics (STLD +0.6%) was the latest to report a strong summer, guiding for above-consensus Q3 earnings as shipments and metal spreads are forecast to improve in spite of continued elevated import activity; Nucor did so yesterday morning (NUE +0.4%).
- Still, Credit Suisse is not ready to embrace the steel company revival, at least when it comes to AK Steel (AKS -4.8%), whose self-help story has less scope for upside surprise than US Steel (X +0.2%); one obvious contrast is that X is looking at shutting down blast furnace steelmaking capacity in North America, while AKS is buying more of it.
- ETF: SLX.
Sep. 17, 2014, 9:15 AM
Sep. 17, 2014, 8:52 AM
- Nucor (NYSE:NUE) +4.4% premarket after raising Q3 earnings guidance substantially, now seeing EPS of $0.70-$0.75 vs. analyst consensus estimate of $0.62; guidance includes a $0.02 charge related to the partial writedown of some assets.
- NUE expects much improved overall operating performance at its steel mills in Q3, seeing increased profitability in sheet, structural, bar and plate steel.
- Structural steel had no major outages in Q3, compared to the planned three week outage at Nucor-Yamato Steel in Q2.
- Says imports remain at high levels, applying downward pressure on pricing.
- The news follows a strong Q3 outlook from U.S. Steel; X +12.8%, AKS +5.7%, STLD +2.3% premarket.
Sep. 16, 2014, 3:41 PM
- AK Steel (AKS +4.4%) says it sees the recently completed Severstal Dearborn acquisition as accretive to its earnings and credit enhancing; it anticipates annual cost-based synergies of ~$50M, with ~$25M realized in 2015.
- Cowen raises its price target to $11 from $9 as it becomes more constructive on AKS shares, especially given the recent ~18% pullback; the firm thinks AKS could benefit from upside to production guidance, an improving product mix at the Dearborn facility, and margin expansion on lower raw material inputs (Briefing.com).
Sep. 8, 2014, 7:49 AM
- AK Steel (NYSE:AKS) -2.8% premarket after announcing concurrent offerings of stock and senior notes.
- AKS says it is launching an offering of 35M common shares, with an underwriters option to purchase up to an additional 5.25M shares; AKS also is offering a total of $430M in senior notes due 2021.
- The company plans to use all proceeds from the notes plus part of the proceeds from the stock sale to fund the acquisition of steel plants from Severstal Dearborn.
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