Tue, Jan. 27, 3:34 PM
- AK Steel (AKS +5.8%) beat Q4 expectations amid rebounding auto and construction industries, prompting S&P Capital to upgrade shares to Strong Buy from Hold with a $6 price target, encouraged by stronger-than-expected synergies from the Dearborn acquisition, lower input costs and energy costs, and a strong auto market that comprised half of AKS revenue in 2014.
- However, other analysts gave the beat a cooler reception; Citigroup's Brian Yu, for one, maintains a Sell rating and $2 price target, unconvinced by Q4's improved shipments of 2M tons and realized pricing of $987/ton vs. the firm's model of $980/ton.
Tue, Jan. 27, 9:46 AM
- AK Steel (AKS +5.1%) opens higher after reporting a strong Q4 earnings beat and a 36% increase in revenues to $2B on sharply higher shipments, due to strong automotive sector demand and a boost from a recent acquisition.
- Average selling prices fell 4% Y/Y to $987/ton from $1,031/ton reported in the year-ago quarter, mostly on the higher proportion of hot-rolled coil shipments in the overall sales mix stemming from its September acquisition of Dearborn Works; shipments jumped 42% due to strong demand in the automotive sector and the Dearborn Works acquisition.
Tue, Jan. 27, 9:10 AM
Fri, Jan. 23, 11:18 AM
- Iron ore miners are broadly lower after Goldman Sachs becomes the latest global bank to deliver a dismal outlook for the steel-making ingredient, forecasting an average price of $66/metric ton this year from an earlier estimate of $80.
- Goldman is at least the fifth bank this month to lower estimates, citing rising seaborne supplies and weaker demand growth from China; just last week, Citigroup cut its iron ore forecast to $58 in 2015, down from its earlier $65, and UBS lowered its target to $66 from $85.
- Low-cost expansions likely will continue as major producers are still mining iron ore at a profit, which would expand the global seaborne surplus from 47M tons this year to 260M tons by 2018, Goldman says.
- Iron ore miners: VALE -8%, BHP -3%, RIO -3.6%, CLF -7.6%.
- Copper miners: FCX -2.6%, SCCO -2.4%, TCK -2.6%.
- Steel companies: X -6.3%, MT -7.1%, AKS -3.2%, NUE -1.2%, STLD -3%, CMC -3.8%, TMST -2.4%.
- Earlier: Goldman gives in on mined commodities
Dec. 22, 2014, 11:24 AM
- South Korea says it has filed a complaint with the WTO seeking to nullify U.S. tariffs levied on imports of certain Korean steel products.
- The U.S. Commerce Department in July imposed tariffs of up to 16% on South Korean steel pipes and tubes used for oil drilling in response to the alleged dumping of steel products in the U.S., and the International Trade Commission confirmed the tariffs in August in what was viewed as a victory for U.S. steelmakers (NYSEARCA:SLX).
- Related stocks: X -5.4%, AKS -5.7%, NUE +0.2%, STLD -1.1%.
Dec. 18, 2014, 9:14 AM| 9 Comments
Dec. 17, 2014, 5:40 PM
Dec. 17, 2014, 5:09 PM
- AK Steel (NYSE:AKS) +7% AH after saying it sees Q4 EPS of $0.05-$0.10, above analyst consensus estimate $0.04, despite incurring ~$31M in costs associated with a planned Ashland Works blast furnace outage.
- AKS says it expects shipments to jump 37% Q/Q to 2M tons in the current quarter from ~1.46M shipped in Q3, helped by acquisitions and strong demand from the auto industry.
- AKS also expects to benefit from lower iron ore, carbon scrap and energy costs in Q4 compared to Q3.
- AKS shares already had surged 6% in the regular trading session, as steel companies (NYSEARCA:SLX) finished broadly higher.
Dec. 10, 2014, 2:59 PM
- J.P. Morgan analysts remain cautious on the steel industry (NYSEARCA:SLX), as the high U.S. steel price premium over Chinese prices should continue to attract imports into the U.S. and put downward pressure on domestic steel prices.
- Hot rolled coil prices have fallen 12% from a high of $700/ton this summer, which JPM says was largely due to temporary production outages which are now back in supply.
- While integrated steel mills U.S. Steel (X -5.4%) and AK Steel (AKS -3.3%) are more leveraged to pricing momentum, the firm prefers Steel Dynamics (STLD -3.2%) and Nucor (NUE -2.6%) given their variable cost structures and significant leverage to an eventual recovery in non-residential construction activity.
Nov. 18, 2014, 12:49 PM
- Iron ore extends its tumble deeper into five-year lows as declining home prices in China add to worries that an economic slowdown in iron ore's biggest buyer will deepen and exacerbate an oversupply.
- Ore with 62% content delivered to Qingdao, China, has retreated 47% YTD to $71.80 a dry ton, and Citigroup thinks prices may drop to less than $60/ton next year as output rises further and demand remains weak; China’s bad loans climbed in Q3 by the most since 2005, while new-home prices declined, adding to speculation the cooling economy will weaken further.
- VALE -2.9%, RIO -1.9%, BHP -1.1%, CLF -6%, X -1.4%, AKS -1.9%.
Nov. 7, 2014, 2:17 PM
- AK Steel (AKS +9.7%) surges nearly 10% after CEO/President James Wainscott discloses the Nov. 6 purchase of 160K shares at $6.18 each, worth $988K.
- Yesterday, AKS announced that the U.S. International Trade Commission decided to impose an anti-dumping order on steel imports from six different countries.
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).
Oct. 29, 2014, 9:15 AM
Oct. 28, 2014, 7:15 PM| Comment!
Oct. 28, 2014, 5:48 PM
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%.
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