Ahead Of The Bell: Olympic Steel Estimate Cut

HARTFORD, Conn. (AP) — An analyst cut her estimates for Olympic Steel Inc. Wednesday after the steelmaker said it will write down the value of its inventory to cut costs.

The forecast reduction comes a day after Olympic Steel announced it expected to record an inventory write-down of $30 million as of March 31.

Analyst Yvonne M. Varano of Jefferies & Co. Inc. slashed her first-quarter estimate to a loss of 45 cents per share from a profit of a penny per share. She cut her second-quarter profit forecast to 8 cents per share from 15 cents per share, and reduced her full-year profit estimate to 25 cents per share from 95 cents per share.

Analysts surveyed by Thomson Reuters expect earnings of 5 cents per share for the first quarter, 17 cents per share for the second quarter and $1.06 per share for the year.

Varano said her reduced first-quarter estimate reflects a lower gross margin assumption.

"We had recently lowered our estimates for the quarter and remainder of the year following our reassessment of demand and price for the industry," she said in a note to investors.