United States Steel ($X) Stock | Taking A Hit On Weak Demand & Macro Uncertainties


United States Steel (NYSE: X)



US Steel Earnings

Today after market closed United States Steel (X) released earnings that came up short of analyst estimates and sent shares tumbling over 10% to $7 per share in the post market session. U.S. Steel announced a fourth quarter loss of $6.83 per share on $2.57 billion in revenues while analyst estimates were slightly higher coming in at 88 cent loss per share on $2.53 billion in revenue. One of the big reasons X missed by so much was a tax provision that cost up to $600 million.


“The Pittsburgh company and other domestic steelmakers have been hurt by a glut of global steelmaking capacity and competition from less-expensive imports that has resulted in low prices.” (MarketWatch)


With the tough challenges currently in the steel market, US Steel has a long way to go before it can get out of this slump. This is one stock that I will be staying away from for right now, however, analysts do have an average price target of $10.72.


X Technicals

X Chart

Shares took a hit in the after market session hitting lows of $6.95 and traded the rest of the evening in the low $7 range on higher than average volume. As of yesterdays close of 7.21 shares are down over 70% since the beginning of 2015 as the steel industry has been under heavy pressure from low commodity and foreign currency prices. Shares haven’t traded above the 200-day moving average since December of 2014 as they continue to trade lower. We should see some support come in at $6.70 and $6.43 while resistance will be met at $7.75 and $8.


Company Profile

United States Steel Corp. is an integrated steel producer of flat-rolled and tubular products with production operations in North America and Europe. It operates through the following segments: Flat-Rolled Products, U.S. Steel Europe and Tubular Products. The Flat-Rolled Products segment is engaged in the production of slabs, rounds, strip mill plates, sheets and tin mill products, as well as all iron ore and coke production facilities in the United States and Canada. This segment primarily serves North American customers in the service center, conversion, transportation, construction, container, and appliance and electrical markets. Its steel rounds and a portion of the hot-rolled sheets are supplied to the Tubular segment. The U.S. Steel Europe segment produces and sells slabs, sheets, strip mill plates, tin mill products and spiral welded pipes, as well as heating radiators and refractory ceramic materials. This segment serves customers in the European construction, service center, conversion, container, transportation, appliance and electrical, and oil, gas and petrochemical markets. The Tubular segment produces and sells seamless and electric resistance welded steel casing and tubing, standard and line pipe and mechanical tubing. This segment primarily serves customers in the oil, gas and petrochemical markets. It is also engaged in the real estate operations and transportation services, including railroad and barge operations. United States Steel was founded in 1901 by Andrew Carnegie, John Pierpont Morgan, Charles Michael Schwab and Elbert Henry Gary and is headquartered in Pittsburgh, PA. (MarketWatch)