NEW YORK (TheStreet) -- Shares of AK Steel  (AKS) - Get Report fell 4.75% to $4.41 in afternoon trading Tuesday after JPMorgan cut its outlook on fellow steel company U.S. Steel  (X) - Get Report and issued a bearish note on steel stocks.

JPMorgan told clients Tuesday to short U.S. Steel, as it expects the nation's largest steel company to operate at a loss this year. It also advised shorting AK Steel.

The firm slashed its fiscal year 2015 estimate on the stock to a loss of 25 cents from a gain of $1.57. For the full year 2016, JPMorgan now expects earnings of $1.42, down from $3.

The firm said a strong dollar, low oil prices, and slowing growth in China would all play a role here.

...we remain cautious on the metals & mining sector as we believe that a strong dollar and weak oil prices will continue to weigh on demand (and prices) for most metals at a time when Chinese growth (and metals consumption) is slowing and Russian exports are increasing. In the U.S., we are not looking for a material increase in steel prices, as we think imports will remain elevated and scrap prices depressed. With the drop in scrap prices, minimills are now the low cost producer, and we think they could use their cost advantage to take share from the integrateds and imports. With this outlook, we continue to recommend a near-term pair trade of long sheet minimills Nucor  (NUE) - Get Report and Steel Dynamics  (STLD) - Get Report and short integrateds AK Steel and US Steel and we are also adding Steel Dynamics to J.P. Morgan's US Equity Analyst Focus List.

Separately, TheStreet Ratings team rates AK STEEL HOLDING CORP as a Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:

"We rate AK STEEL HOLDING CORP (AKS) a SELL. This is driven by some concerns, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, poor profit margins, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

• The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Metals & Mining industry. The net income has significantly decreased by 61.6% when compared to the same quarter one year ago, falling from $35.20 million to $13.50 million.
• The gross profit margin for AK STEEL HOLDING CORP is currently extremely low, coming in at 10.07%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 0.67% trails that of the industry average.
• Net operating cash flow has decreased to $57.80 million or 49.07% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, AK STEEL HOLDING CORP has marginally lower results.
• Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 35.34%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 73.07% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
• AK STEEL HOLDING CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, AK STEEL HOLDING CORP reported poor results of -$0.74 versus -$0.34 in the prior year. This year, the market expects an improvement in earnings (-$0.30 versus -$0.74).
• You can view the full analysis from the report here: AKS Ratings Report