UPDATE: Credit Suisse Upgrades US Steel (X) to Outperform
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Credit Suisse analyst Curt Woodworth upgraded US Steel (NYSE: X) from Underperform to Outperform with a price target of $35.00 (from $15.00).
The analyst comments "We Upgrade X to Outperform and increase or TP to $35 to account for significantly higher earnings estimates and a higher target multiple given recent structural changes specifically at US Steel but also to the US and global steel market landscape which favors X. The recent decision to stop the Mon Valley upgrade project and curtail coke production is a clear signal X is serious about improving ROIC and reducing its carbon footprint. The acquisition of BRS was well timed and given the profitability (>30% 1Q EBITDA mgn) / synergy with X downstream, we believe X will likely continue to reinvest in greenfield EAF / DRI capacity vs upgrade of an older hot strip mill (ie MV). X has potential to unlock value in its iron ore assets which have ~23mt of capacity compared to internal needs of only 14mt. Recall Stelco purchased option to acquire 25% of Minntac in 2Q-20 at implied value of $2.4bn for the asset."
Shares of US Steel closed at $24.78 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst PT Change, Hot Comments, Hot Upgrades, Upgrades
Related EntitiesCredit Suisse, Earnings, Definitive Agreement
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