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AK Steel Lauds U.S. ITC's Decision on Chinese Imports
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AK Steel recently applauded the unanimous decision by the U.S. International Trade Commission (“ITC”) that the U.S. steel industry has been materially injured by unfairly traded imports of stainless steel sheet and strip from China.
As such, the U.S. Department of Commerce (“DOC”) will issue unfair trade orders to levy antidumping duties on imports from China of 63.86% to 76.64%, and countervailing duties of 75.60% to 190.71%.
The ITC determination successfully concludes antidumping and countervailing investigations following petitions filed in Feb 2016 by AK Steel along with other steel companies.
Steel market conditions in the U.S. have been recovering lately, driven by favorable developments on steel trade cases in the recent past. Steel imports were down around 15% year over year in 2016. Moreover, steel prices have rebounded partly on the back of punitive trade actions that led to levy of tariffs on imports.
U.S. steel producers continue to actively press the U.S. regulators to stop unfair trade practices and ensure a fairer and more competitive market for American steel makers and workers.
AK Steel outperformed the Zacks categorized Steel-Producers industry over a year, supported by its forecast-topping earnings performance in the trailing four quarters. The company's shares gained 87.7% during the period while the industry saw a gain of about 49.4%.
AK Steel topped earnings estimates in fourth-quarter 2016, helped by its cost-reduction actions. The company's adjusted earnings of 25 cents per share for the quarter topped the Zacks Consensus Estimate of 7 cents.
However, sales fell roughly 8% year over year to $1,418.6 million on lower shipments and missed the Zacks Consensus Estimate of $1,434 million. Shipments for the quarter were down around 15% year over year to 1,412,200 tons, affected by the company's move to reduce commodity steel sales to the distributor and converters market and slightly lower shipments to the automotive industry.
AK Steel expects shipments for first-quarter 2017 to be modestly higher on a sequential comparison basis as a seasonal pick-up in automotive shipments is expected to be partly offset by lower shipments to the electrical steel market.
The company also sees its average selling price to be flat in the first quarter compared with the fourth quarter. It expects a modest increase in selling prices on a year over year basis.
AK Steel remains committed to reduce cost amid a still challenging operating environment. Its cost reduction initiatives are lending support to its bottom line as witnessed in the fourth quarter. The company saw a roughly 9% decline in its total operating costs in the quarter. AK Steel is looking for cost saving opportunities in 2017 through a number of means including process improvement, headcount cuts, reduction in process time and procurement activities.
AK Steel should also benefit from the healthy momentum in the automotive market. The company is looking to continue to grow its core automotive business in 2017.
AK Steel is a Zacks Rank #3 (Hold) stock.
AK Steel Holding Corporation Price and EPS Surprise
U.S. Steel has an expected long-term growth of 8%.
Ternium has an expected long-term growth of 18.4%.
POSCO has an expected long-term growth of 5%.
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AK Steel Lauds U.S. ITC's Decision on Chinese Imports
AK Steel recently applauded the unanimous decision by the U.S. International Trade Commission (“ITC”) that the U.S. steel industry has been materially injured by unfairly traded imports of stainless steel sheet and strip from China.
As such, the U.S. Department of Commerce (“DOC”) will issue unfair trade orders to levy antidumping duties on imports from China of 63.86% to 76.64%, and countervailing duties of 75.60% to 190.71%.
The ITC determination successfully concludes antidumping and countervailing investigations following petitions filed in Feb 2016 by AK Steel along with other steel companies.
Steel market conditions in the U.S. have been recovering lately, driven by favorable developments on steel trade cases in the recent past. Steel imports were down around 15% year over year in 2016. Moreover, steel prices have rebounded partly on the back of punitive trade actions that led to levy of tariffs on imports.
U.S. steel producers continue to actively press the U.S. regulators to stop unfair trade practices and ensure a fairer and more competitive market for American steel makers and workers.
AK Steel outperformed the Zacks categorized Steel-Producers industry over a year, supported by its forecast-topping earnings performance in the trailing four quarters. The company's shares gained 87.7% during the period while the industry saw a gain of about 49.4%.
AK Steel topped earnings estimates in fourth-quarter 2016, helped by its cost-reduction actions. The company's adjusted earnings of 25 cents per share for the quarter topped the Zacks Consensus Estimate of 7 cents.
However, sales fell roughly 8% year over year to $1,418.6 million on lower shipments and missed the Zacks Consensus Estimate of $1,434 million. Shipments for the quarter were down around 15% year over year to 1,412,200 tons, affected by the company's move to reduce commodity steel sales to the distributor and converters market and slightly lower shipments to the automotive industry.
AK Steel expects shipments for first-quarter 2017 to be modestly higher on a sequential comparison basis as a seasonal pick-up in automotive shipments is expected to be partly offset by lower shipments to the electrical steel market.
The company also sees its average selling price to be flat in the first quarter compared with the fourth quarter. It expects a modest increase in selling prices on a year over year basis.
AK Steel remains committed to reduce cost amid a still challenging operating environment. Its cost reduction initiatives are lending support to its bottom line as witnessed in the fourth quarter. The company saw a roughly 9% decline in its total operating costs in the quarter. AK Steel is looking for cost saving opportunities in 2017 through a number of means including process improvement, headcount cuts, reduction in process time and procurement activities.
AK Steel should also benefit from the healthy momentum in the automotive market. The company is looking to continue to grow its core automotive business in 2017.
AK Steel is a Zacks Rank #3 (Hold) stock.
AK Steel Holding Corporation Price and EPS Surprise
AK Steel Holding Corporation Price and EPS Surprise | AK Steel Holding Corporation Quote
Stocks to Consider
Better-ranked companies in the steel space include United States Steel Corporation (X - Free Report) , Ternium S.A. (TX - Free Report) and POSCO (PKX - Free Report) , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
U.S. Steel has an expected long-term growth of 8%.
Ternium has an expected long-term growth of 18.4%.
POSCO has an expected long-term growth of 5%.
8 Stocks with Huge Profit Potential
Just released: Driverless Cars: Your Roadmap to Mega-Profits Today. In this latest Special Report, Zacks’ Aggressive Growth Strategist Brian Bolan explores a full-blown technological breakthrough in the making – autonomous cars. He also spotlights 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>