Jefferies Upgrades Olympic Steel (ZEUS) to Buy, Downgrades Ryerson (RYI) to Hold

Jefferies upgraded Olympic Steel (NASDAQ: ZEUS) from Hold to Buy and downgraded Ryerson Inc. (NYSE: RYI) from Buy to Hold, with price targets of $16 and $7.50, respectively.

Analyst Luke Folta said despite recent margin under-performance, ZEUS' FCF far exceeds that of RYI, offering better downside support and opportunity for deleveraging, share repo's or growth investments.

In addition, Margin drag from flat rolled price downtrend has been a greater drag on ZEUS vs. RYI; greater upside for ZEUS as prices stabilize/ improve.

The analyst also said ZEUS has greater earnings leverage to carbon flat rolled pricing, offering greater upside optionality around a potential positive HRC, CRC & coated trade case ruling.

ZEUS' shares are far cheaper relative to est. FCF generation and net tangible assets, the analyst added.

For an analyst ratings summary and ratings history on Olympic Steel click here. For more ratings news on Olympic Steel click here.

Shares of Olympic Steel closed at $11.81 yesterday.

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