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U.S. Steel (X) Gives Q1 View, Expects Strong Market Momentum
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United States Steel Corporation (X - Free Report) has announced its earnings guidance for the first quarter of 2023. The adjusted EBITDA for the quarter is projected to be roughly $375 million. First-quarter adjusted earnings per share are expected between 58 cents and 63 cents.
The company stated that it witnessed momentum building in its North American flat-rolled market. Apart from delivering strong safety, operating performance and improved order entry, the company remains committed to growing its share in strategic markets. This is expected to result in better-than-expected first-quarter performance and benefit it in the second quarter as well.
The company remains bullish toward delivering strong performance in 2023, as reflected by its flat-rolled segment order book, which reflects improved demand. U.S. Steel also sees strong order books from its Mini Mill segment. Cost structures for this segment are expected to improve as it is likely to offset high prices for metallics purchased at the beginning of the Russia-Ukraine war. The company also saw positive EBITDA return in Europe for February, as market conditions improved. Its tubular segment is also expected to deliver sequential improvement in EBITDA in the first quarter on the back of healthy pipe prices order entry.
The company expects the Flat-rolled segment’s adjusted EBITDA to be down sequentially due to the seasonal mining headwinds, which occur each year in the first quarter. X also expects broad improvements in key markets, as reflected by the segment’s order book.
The Mini Mill segment is projected to deliver positive EBITDA in the first quarter as metallic costs started to stabilize in the latter half. The realization of higher steel prices is also expected to contribute to higher EBITDA.
The company’s European segment is expected to deliver negative EBITDA, but the numbers are anticipated to be better than the outlook provided by the company in February. Its adjusted EBITDA for February was positive and is expected to remain positive for March. The company witnessed improved market prices which reflects stronger demand and reduced importing activity. Lower energy costs are expected to contribute to segment performance in the first quarter.
The Tubular segment’s adjusted EBITDA is projected to increase for the 10th consecutive quarter due to healthy demand, better product mix and higher realized average selling prices for the first quarter.
Under the current stock buyback authorization of $500 million, the company anticipates closing the repurchase of $75 million worth of common stock in the first quarter. The company plans to buy back roughly 15% of its outstanding diluted shares by the end of the first quarter since the beginning of Dec 2021, which amounts to roughly $1.1 billion returned to its stockholders through share repurchase.
Shares of U.S. Steel have lost 32.4% in the past year compared with a 9.1% fall recorded by its industry.
Image Source: Zacks Investment Research
Zacks Rank & Other Key Picks
U.S. Steel currently carries a Zacks Rank #2 (Buy).
ATI’s shares have gained 36.7% in the past year. The Zacks Consensus Estimate for ATI’s current-year earnings has been revised 1.4% upward in the past 60 days. The company has an earnings growth rate of 9% for the current year.
ATI topped Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 32.4% on average.
Olympic Steel’s shares have gained 27.5% in the past year. The Zacks Consensus Estimate for its current-year earnings has been revised 61% upward in the past 60 days. ZEUS topped Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 26.2% on average.
Cal-Maine’s shares have gained 9% in the past year. The company has an earnings growth rate of 515.8% for the current year. The Zacks Consensus Estimate for CALM’s current-year earnings has been revised 19% upward in the past 60 days.
CALM topped Zacks Consensus Estimate in three of the last four quarters. It delivered a trailing four-quarter earnings surprise of 15.3% on average.
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U.S. Steel (X) Gives Q1 View, Expects Strong Market Momentum
United States Steel Corporation (X - Free Report) has announced its earnings guidance for the first quarter of 2023. The adjusted EBITDA for the quarter is projected to be roughly $375 million. First-quarter adjusted earnings per share are expected between 58 cents and 63 cents.
The company stated that it witnessed momentum building in its North American flat-rolled market. Apart from delivering strong safety, operating performance and improved order entry, the company remains committed to growing its share in strategic markets. This is expected to result in better-than-expected first-quarter performance and benefit it in the second quarter as well.
The company remains bullish toward delivering strong performance in 2023, as reflected by its flat-rolled segment order book, which reflects improved demand. U.S. Steel also sees strong order books from its Mini Mill segment. Cost structures for this segment are expected to improve as it is likely to offset high prices for metallics purchased at the beginning of the Russia-Ukraine war. The company also saw positive EBITDA return in Europe for February, as market conditions improved. Its tubular segment is also expected to deliver sequential improvement in EBITDA in the first quarter on the back of healthy pipe prices order entry.
The company expects the Flat-rolled segment’s adjusted EBITDA to be down sequentially due to the seasonal mining headwinds, which occur each year in the first quarter. X also expects broad improvements in key markets, as reflected by the segment’s order book.
The Mini Mill segment is projected to deliver positive EBITDA in the first quarter as metallic costs started to stabilize in the latter half. The realization of higher steel prices is also expected to contribute to higher EBITDA.
The company’s European segment is expected to deliver negative EBITDA, but the numbers are anticipated to be better than the outlook provided by the company in February. Its adjusted EBITDA for February was positive and is expected to remain positive for March. The company witnessed improved market prices which reflects stronger demand and reduced importing activity. Lower energy costs are expected to contribute to segment performance in the first quarter.
The Tubular segment’s adjusted EBITDA is projected to increase for the 10th consecutive quarter due to healthy demand, better product mix and higher realized average selling prices for the first quarter.
Under the current stock buyback authorization of $500 million, the company anticipates closing the repurchase of $75 million worth of common stock in the first quarter. The company plans to buy back roughly 15% of its outstanding diluted shares by the end of the first quarter since the beginning of Dec 2021, which amounts to roughly $1.1 billion returned to its stockholders through share repurchase.
Shares of U.S. Steel have lost 32.4% in the past year compared with a 9.1% fall recorded by its industry.
Image Source: Zacks Investment Research
Zacks Rank & Other Key Picks
U.S. Steel currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the basic materials space are ATI Inc. (ATI - Free Report) , Olympic Steel, Inc. (ZEUS - Free Report) and Cal-Maine Foods, Inc. (CALM - Free Report) . ATI currently carries a Zacks Rank #2, while ZEUS and CALM sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
ATI’s shares have gained 36.7% in the past year. The Zacks Consensus Estimate for ATI’s current-year earnings has been revised 1.4% upward in the past 60 days. The company has an earnings growth rate of 9% for the current year.
ATI topped Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 32.4% on average.
Olympic Steel’s shares have gained 27.5% in the past year. The Zacks Consensus Estimate for its current-year earnings has been revised 61% upward in the past 60 days. ZEUS topped Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 26.2% on average.
Cal-Maine’s shares have gained 9% in the past year. The company has an earnings growth rate of 515.8% for the current year. The Zacks Consensus Estimate for CALM’s current-year earnings has been revised 19% upward in the past 60 days.
CALM topped Zacks Consensus Estimate in three of the last four quarters. It delivered a trailing four-quarter earnings surprise of 15.3% on average.