On Jan 11, Zacks Investment Research downgraded specialty
) to a Zacks Rank #5 (Strong Sell).
Allegheny posted a loss in the third quarter of 2013 due to
lower sales and weak pricing. Charges associated with the sale of
businesses also weighed on the company's bottom line. Loss for
the quarter was narrower than the Zacks Consensus Estimate while
sales missed the same. Allegheny expects business conditions to
remain challenging in the fourth quarter and potentially in 2014
due to U.S. debt ceiling and other fiscal policy issues.
Allegheny is contending with a soft economy and raw material
cost pressures. Reduced raw material surcharges and low base
prices of standard stainless products impacted the results of its
key Flat-Rolled Products segment. Weak demand and increased Asian
imports are contributing to lower stainless steel sheet plate
The demand for Allegheny's standard stainless products has
been hit by rapidly falling raw material surcharges, which
resulted in customers delaying purchases. In addition, the same
factors appear to be influencing the short-term demand for some
high-value products from key end-markets as many customers are
being cautious and keeping inventories lean.
Allegheny does not see any significant improvement in global
demand in the Flat-Rolled Products segment in the near term due
to lack of mega projects. The business environment is expected to
remain challenging through the final quarter of 2013 given the
uncertain economic environment.
Weak demand from jet engine aftermarket and nuclear energy is
expected to continue to affect Allegheny's results. Demand for
forging from construction and mining markets also remains
Other Stocks to Consider
Other companies in the steel and related industries worth
Companhia Siderurgica Nacional
United States Steel Corp.
). While Companhia Siderurgica and ArcelorMittal carry a Zacks
Rank #1 (Strong Buy), United States Steel holds a Zacks Rank #2
ALLEGHENY TECH (ATI): Free Stock Analysis
ARCELOR MITTAL (MT): Free Stock Analysis
CIA SIDERUR-ADR (SID): Free Stock Analysis
UTD STATES STL (X): Free Stock Analysis
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