Tuesday, November 21, 2017 11:43:20 AM
11:22 AM ET 11/21/17 | CFRA
Steel stocks, including AK Steel Holding Corporation (NYSE:AKS), have been under heavy selling pressure for most of the year but arestaging a rebound from their 2017 lows. The Analyst Credit Suisse's Curt Woodworth upgraded AK Steel's stock rating from Neutral to Outperform with a price target raised from $6 to $7. The Thesis AK Steel boasts several near-term catalysts that make the stock "compelling," Woodworth said in a Monday note. (See Woodworth's track record here.) First, AK Steel will benefit from an increase of around $30 per ton on its value add sheet in 2018 and $80 per ton on stainless and electrical steel products. This should result in an incremental EBITDA of $180 million in 2018 and comes at a time when investors "overly penalized" the stock for a poor third quarter report, the analyst said. Second, AK Steel has a "clear leadership position" in value add markets where through-the-cycle margins are strong, the analyst said. The company holds various surcharge mechanisms in place for chrome and electrodes and is hedged for zinc and ore, according to Credit Suisse. Third, investors will re-rate their views on AK Steel and pay a higher multiple on free cash flow once the contract prices reset and management finalizes financing for its acquisition of Precision Partners, Woodworth said. The stock is trading at a 21 percent free cash flow yield on 2018 numbers, which makes in the "most attractive of any steel company we cover," the analyst said. Price Action Shares of AK Steel were trading higher by 5.72 percent at the time of publication, at $4.89. Related Links: Benzinga's Top Upgrades, Downgrades For November 21, 2017 33 Stocks Moving In Tuesday's Pre-Market S
VHAI - Vocodia Partners with Leading Political Super PACs to Revolutionize Fundraising Efforts • VHAI • Sep 19, 2024 11:48 AM
Dear Cashmere Group Holding Co. AKA Swifty Global Signs Binding Letter of Intent to be Acquired by Signing Day Sports • DRCR • Sep 19, 2024 10:26 AM
HealthLynked Launches Virtual Urgent Care Through Partnership with Lyric Health. • HLYK • Sep 19, 2024 8:00 AM
Element79 Gold Corp. Appoints Kevin Arias as Advisor to the Board of Directors, Strengthening Strategic Leadership • ELMGF • Sep 18, 2024 10:29 AM
Mawson Finland Limited Further Expands the Known Mineralized Zones at Rajapalot: Palokas step-out drills 7 metres @ 9.1 g/t gold & 706 ppm cobalt • MFL • Sep 17, 2024 9:02 AM
PickleJar Announces Integration With OptCulture to Deliver Holistic Fan Experiences at Venue Point of Sale • PKLE • Sep 17, 2024 8:00 AM