Goldman Sachs Downgrades AK Steel (AKS) to Sell

Goldman Sachs downgraded AK Steel (NYSE: AKS) from Neutral to Sell with a price target of $3.00 (from $3.50).

The firm comments, "AKS's share price has risen by 20% in the last two months, almost twice the rate of its peers, which we do not see as warranted given our view of continuing weak flat steel prices, a highly leveraged balance sheet, high pension funding requirements, high capex to fund its raw material strategy, and no sign of turnaround in its lucrative electrical steel business. AKS is currently trading at 12.8X 2013E P/E, over 25% above its historical NTM P/E multiple of 10.2X, and we believe the stock will see multiple contraction over coming months as the market recognizes its weak earnings potential."

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

Shares of AK Steel closed at $4.44 yesterday.

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