AK Steel Holding Corp

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AKS : NYSE : Basic Materials
$5.8 -0.14 | -2.36%
Today's Range: 5.78 - 5.97
Avg. Daily Volume: 1.80874E7
05/26/17 - 4:00 PM ET

Financial Analysis


AK STEEL HOLDING CORP's gross profit margin for the first quarter of its fiscal year 2017 has significantly increased when compared to the same period a year ago. The company has grown sales and net income during the past quarter when compared with the same quarter a year ago, however, it was unable to keep up with the growth of the average competitor within its industry. AK STEEL HOLDING CORP has weak liquidity. Currently, the Quick Ratio is 0.68 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

At the same time, stockholders' equity ("net worth") has greatly increased by 78.84% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q1 FY17 Q1 FY16
Net Sales ($mil)1533.41518.8
EBITDA ($mil)167.6101.7
EBIT ($mil)112.548.0
Net Income ($mil)62.5-13.6


Balance Sheet Q1 FY17 Q1 FY16
Cash & Equiv. ($mil)185.7113.0
Total Assets ($mil)4104.43987.3
Total Debt ($mil)1853.02336.4
Equity ($mil)-209.5-990.5


Profitability Q1 FY17 Q1 FY16
Gross Profit Margin15.5710.88
EBITDA Margin10.926.69
Operating Margin7.343.16
Sales Turnover1.441.62
Return on Assets1.66-5.42
Return on Equity0.00.0
Debt Q1 FY17 Q1 FY16
Current Ratio1.851.76
Debt/Capital1.131.74
Interest Expense39.442.8
Interest Coverage2.861.12


Share Data Q1 FY17 Q1 FY16
Shares outstanding (mil)314.79178.38
Div / share0.00.0
EPS0.19-0.08
Book value / share-0.67-5.55
Institutional Own % n/a n/a
Avg Daily Volume1.8304888E72.2353802E7

Valuation


HOLD. The current P/E ratio indicates a significant discount compared to an average of 34.90 for the Metals & Mining industry and a discount compared to the S&P 500 average of 25.02. Normally, for additional comaprison, we would look at the price-to-book ratio; however, this company's price-to-book ratio is negative making the value useless for comparisons. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. After reviewing these and other key valuation criteria, AK STEEL HOLDING CORP proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
AKS 20.96 Peers 34.90   AKS 17.11 Peers 11.46

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

AKS is trading at a significant discount to its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

AKS is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
AKS 7.68 Peers 20.68   AKS NM Peers 1.29

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

AKS is trading at a significant discount to its peers.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

AKS's negative PEG ratio makes this valuation measure meaningless.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
AKS NM Peers 1.74   AKS 121.31 Peers 242.77

Neutral. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

AKS's P/B is negative making this valuation measure meaningless.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, AKS is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
AKS 0.29 Peers 2.94   AKS -8.73 Peers 6.23

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

AKS is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

AKS significantly trails its peers on the basis of sales growth

 

 

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