) reached a new 52-week high of $8.58 on Jul 3, eclipsing its
previous high of $8.55. The stock retraced to end the trading
session at $8.42 on that day.
The steel maker, which has a market cap of around $1.2 billion,
has seen its shares skyrocket roughly 176% over a year. Average
volume of shares traded over the last three months is around
What's Driving AKS Up?
AK Steel, a Zacks Rank #3 (Hold) stock, is benefiting from
strength in the automotive market and higher shipment of steel
products to automakers. The company gets more than half of its
revenues from this market which continues to show strong
AK Steel's automotive shipments were at their highest level in
seven years in the first quarter of 2014. The company is expected
to continue to gain automotive market share in 2014, driven by
continued solid demand for its carbon and stainless steel products
from its automotive customers.
AK Steel is also investing to procure about half of its iron ore
and coal requirements internally. It is making good progress with
its first coal mine at AK Coal and is ramping up mining volumes. AK
Steel is also making significant progress with its iron ore pellet
project at Magnetation. Production of first pellets is expected by
fourth-quarter 2014 with a ramp up to full capacity in 2015. Both
these strategic investments are expected to improve the company's
cost structure and strengthen its position in the years ahead.
AK Steel should also benefit from the favorable pricing trend
for key raw materials such as iron ore, coke and coal. The company
expects to gain from lower costs of coal and coke in 2014 with some
benefits are expected to be seen in the second quarter.
Other Stocks to Consider
Some other stocks worth considering in the steel space include
Universal Stainless & Alloy Products Inc.
Grupo Simec S.A.B. de C.V.
). While both Universal Stainless and Grupo Simec retain a Zacks
Rank #1 (Strong Buy), ThyssenKrupp holds a Zacks Rank #2 (Buy).
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