AK Steel (AKS) Surges On Dual Upgrade

Shares of AK Steel Holding Corporation (NYSE: AKS) are staging an impressive rally today after a dual upgrade of the company.

Citigroup upgraded the stock from Neutral to Buy but lowered their price target to $19 and Bank of America/Merrill Lynch upgraded the stock from Underperform to Neutral.

Citigroup's upgraded came after the 46% "free fall" in the stock. The firm noted that the shares are now trading at less than 10x 2011 P/E and negative are priced in with low sell-side ratings (2 Buy, 11 Hold and 1 Sell) and high short interest of 17 million shares.

Merrill said concerns on slower growth in electrical steel and raw material cost impacts appear discounted in valuation.

Shares of AK Steel are up 12% to $15.15 today. Rival U.S. Steel Corp. (NYSE: X) is also seeing a 3.6% bounce today on the sector rally.

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