United States Steel Corporation Stock Sell Recommendation Reiterated (X)
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- The debt-to-equity ratio of 1.02 is relatively high when compared with the industry average, suggesting a need for better debt level management. Along with the unfavorable debt-to-equity ratio, X maintains a poor quick ratio of 0.90, which illustrates the inability to avoid short-term cash problems.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Metals & Mining industry and the overall market, UNITED STATES STEEL CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for UNITED STATES STEEL CORP is currently extremely low, coming in at 8.10%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 0.94% significantly trails the industry average.
- X has underperformed the S&P 500 Index, declining 16.37% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
- Despite the weak revenue results, X has outperformed against the industry average of 19.5%. Since the same quarter one year prior, revenues slightly dropped by 8.4%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
--Written by a member of TheStreet Ratings Staff. It's Official: Action Alerts PLUS beats the S&P 500 with Dividends Reinvested! Cramer and Link were up 16.72% in 2012. Were you? See what they are trading for 14-days FREE
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