Boston, MA 07/05/2013 (wallstreetpr) – Along with eight other steel producing companies, United States Steel Corporation (NYSE:X), the largest integrated steel producer of North America, has filed a petition with the International Trade Commission and Department of Commerce, demanding an anti-dumping relief on the import of certain oil and natural gas pipe products from nine countries, namely South Korea, Vietnam and India among others. The above countries are allegedly exporting the products at a lower than the selling price in the United States.
Since 2008, global demand for steel has been sluggish and the price has remained consistently weak, a fact that affected the business of United States Steel Corporation (NYSE:X) to a great extent. The main market for the company has been Asia, especially China. However, the slowing down of the demand for commodities in this region has multiplied the problems of this company, currently having one of the most debt-heavy balance sheets. The company has a market capitalization of $2.5 billion, dwarfed by the debt it carries, amounting to $3.9 billion. It produced 19 million tons of steel, about equal to the output of the market leader, Nucor Corporation (NYSE:NUE), resulting in significant oversupply. The volatility of raw material costs coupled with very high pension obligations has certainly not played a positive role for the company’s prospects.
Earnings estimates from analysts for the next year are also volatile, starting from a loss of $0.40 to a profit of $3 per share. The stock price is currently close to its 52-week low, moving in a broad range between $16 and $20, albeit short-term speculators are still bullish as is evident from the call-put ratio.The share price closed at $19.25 last night.
The bullish sentiment may be explained by the improved profitability in its European operations, currently at the highest level since 2010 and by the payment of a major portion of the convertible notes due in 2014.
