Perilous Reversal Watch: United States Steel (X)
Trade-Ideas LLC identified
(
) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified United States Steel as such a stock due to the following factors:
- X has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $357.5 million.
- X has traded 740,454 shares today.
- X is down 3.1% today.
- X was up 11.1% yesterday.
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More details on X:
United States Steel Corporation produces and sells flat-rolled and tubular steel products in North America and Europe. It operates through three segments: Flat-Rolled Products (Flat-Rolled), U. S. Steel Europe (USSE), and Tubular Products (Tubular). The stock currently has a dividend yield of 0.9%. Currently there is 1 analyst that rates United States Steel a buy, 5 analysts rate it a sell, and 7 rate it a hold.
The average volume for United States Steel has been 15.5 million shares per day over the past 30 days. United States has a market cap of $3.1 billion and is part of the basic materials sector and metals & mining industry. The stock has a beta of 2.65 and a short float of 34.8% with 3.02 days to cover. Shares are up 187.6% year-to-date as of the close of trading on Tuesday.
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Analysis:
rates United States Steel as a
. The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk, disappointing return on equity and poor profit margins.
Highlights from the ratings report include:
- Currently the debt-to-equity ratio of 1.64 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. Along with the unfavorable debt-to-equity ratio, X maintains a poor quick ratio of 0.89, which illustrates the inability to avoid short-term cash problems.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. 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 7.24%. Regardless of X's low profit margin, it has managed to increase from the same period last year.
- Despite the weak revenue results, X has significantly outperformed against the industry average of 45.8%. Since the same quarter one year prior, revenues fell by 10.9%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- UNITED STATES STEEL CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, UNITED STATES STEEL CORP swung to a loss, reporting -$11.24 versus $0.63 in the prior year. This year, the market expects an improvement in earnings (-$1.97 versus -$11.24).
- You can view the full United States Steel Ratings Report.
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