Events and Updates

Title: U.S. Steel Stock Has Been Slammed This Year. Its Earnings Weren’t Bad.

Posted on: 2nd August 2019

United States Steel ’s earnings may offer some relief for the embattled company.

The company reported a second-quarter profit of 45 cents a share, better than the 40 cents Wall Street predicted. And adjusted earnings before interest, taxes, depreciation and amortization, or Ebitda, totaled $278 million, better than the $250 million management had told investors to expect.

The stock is down more than 20% year to date and is off almost 60% over the past year, a far worse performance than for the Dow Jones Industrial Average. Low steel price and weak demand for products such as cars have weighed on most steel stocks so far in 2019.

“Our execution in the second quarter was strong despite challenging market conditions,” said CEO David Burritt in the company’s news release. “We overcame logistics headwinds from severe weather and delivered for our customers, exceeding even our own expectations.”

Barron’s wrote positively about the stock in March after prices spiked for iron ore—a key ingredient in steel making—because of safety concerns and environmental problems at the Brazilian mining company Vale (VALE). Although ore prices have risen 80% year to date, steel prices haven’t followed. Benchmark prices for steel are down about 16% this year.

U.S. Steel stock is down 26% since our article appeared. The Dow has risen 5% since then.

The company has scheduled a conference call for analysts and investors at 8:30 a.m. Eastern time on Friday.