AK Steel (AKS) Stock Rises on Q2 Earnings Beat
NEW YORK (TheStreet) -- Shares of AK Steel (AKS) - Get Report are rising 6.64% to $5.78 this morning after the company reported a surprising profit for the 2016 second quarter.
AK Steel reported adjusted earnings of 8 cents per diluted share. Analysts were looking for the West Chester, OH-based company to report a loss of 2 cents per share.
The company also had revenue of $1.49 billion for the quarter, falling short of estimates of $1.53 billion. The lower revenue was attributed to lower automotive contract pricing as well as a decrease in shipments.
"Our strategic decision to reduce exposure to commodity spot markets, optimize our footprint and focus on higher value products continued to show positive results as we achieved another quarter of significant improvement," said CEO Roger Newport.
Shipments of higher value coated products, primarily for the automotive market, made up 53% of the company's total volume for the quarter as opposed to 45% for the 2015 second quarter.
U.S. steelmakers are beginning to benefit from tariffs on steel imports, which the industry lobbied for after large amounts of low-price imports crushed steel prices last year, MarketWatch reports.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings rated this stock as a "hold" with a ratings score of C-.
The company's strengths can be seen in multiple areas, such as its solid stock price performance, compelling growth in net income and good cash flow from operations. However, as a counter to these strengths, TheStreet Ratings finds that the company's profit margins have been poor overall.
You can view the full analysis from the report here: AKS