AKS Hopeful of New Energy Standards - Analyst Blog
07 2월 2012 - 1:35AM
Zacks
AK Steel Holding Corporation (AKS) announced
that revised energy efficiency standards proposed by the U.S.
Department of Energy (DOE) will not have any major impact on its
grain-oriented electrical steels (GOES) market. GOES is used in the
manufacture of electrical distribution transformers.
Initially, AK Steel believed that DOE will alter the efficiency
standards in such a way so that it could reduce the competitiveness
of its electrical products. However, the company feels that the new
standards have the potential to boost the market for GOES.
The revised efficiency standards as proposed by DOE are expected
to become effective in 2016. Meanwhile, AK Steel will continue
investing in research and development activities so that these
standards do not have any material impact on the market for its
GOES products.
Recently, AK Steel posted its fourth-quarter 2011 results,
delivering a net loss of $193.9 million or $1.76 per share compared
with $98.3 million or 89 cents per share during the year-ago
quarter.
Fourth-quarter 2011 results include a non-cash pre-tax pension
corridor charge of $268.1 million, or $1.50 per share. Excluding
this amount, the company's adjusted net loss for the fourth quarter
of 2011 was $28.0 million, or 26 cents per share. Results beat the
Zacks Consensus Estimate loss of 39 cents per share.
Net sales were $1.51 billion in the quarter on shipments of 1.41
million tons versus $1.39 billion and 1.36 million tons in the
prior-year quarter. Net sales were ahead of the Zacks Estimate of
$1.48 billion. Average selling price for the fourth quarter of 2011
was $1,070 per ton, up 5% year over year, but down 8%
sequentially.
AK Steel is uniquely positioned to focus on products with high
margins. Electrical steel continues to be the company’s strongest
product line, with demand recovering in the U.S. and abroad, though
at a slower rate. AK Steel is operating its plants at above 80%
capacity and is well positioned to serve the end markets when the
demand rebounds.
However, higher input costs, particularly iron ore, is eroding the
company’s margins. Iron ore pricing concerns have led to a negative
outlook for steel manufacturers. A K Steel currently retains a
Zacks #3 Rank (short-term Hold rating).
Ohio-based AK Steel Holding Corporation is a leading producer of
flat-rolled carbon, stainless, electrical steel and tubular
products. It operates 7 steel-making and finishing plants in Ohio,
Pennsylvania, Indiana and Kentucky. The company competes with
Nucor Corporation (NUE), U.S. Steel
Corp. (X) and Steel Dynamics Inc.
(STLD).
AK STEEL HLDG (AKS): Free Stock Analysis Report
NUCOR CORP (NUE): Free Stock Analysis Report
STEEL DYNAMICS (STLD): Free Stock Analysis Report
UTD STATES STL (X): Free Stock Analysis Report
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