Inconsistency in beating street consensus over the past years adds uncertainty to the post-earnings stock movement.
The stock is down 54% so far this year, though the stock movement has been pretty much sideways since the beginning of this year. Meanwhile, people who have stayed invested in over 5 years will feel the pinch, with the stock losing almost 73% of its value.
Over this period, AK Steel has delivered decent top-line growth and has turned profitable as well. However, headwinds surrounding the industry continues to bite its valuation.
The spike in iron ore prices could be a challenge for the
company, which procures the raw material from third parties. Separately, weakness
in the US automotive industry, which accounts for most of its clientele, is
another dampener.
Investors will be closely following the earnings conference call for updates on the management’s strategy to tackle these headwinds.
During the last reported quarter, the company slipped to a loss from a profit a year ago, due to higher costs and expenses as well as a drop in flat-rolled steel shipments.
The stock has a 12-month average price target of $1.77, which is at a 28% downside from Thursday’s trading price.