NEW YORK (TheStreet) -- Shares of U.S. Steel Corp. (X) are up 1.49% to $26.58 today, as Brent crude oil steadied above $61 a barrel on data that showed the U.S. economy grew at its quickest pace in 11 years in the third quarter, easing preoccupations that there could be less demand for steel products the oil sector uses, Reuters reports.
The steel makers' stock followed oil prices down yesterday, dropping more than 8%, amid capital expenditure cuts by U.S. oil producers, which in turn suggested less demand for steel products like oil country tubular goods.
Oil analysts said the positive impact of the U.S. GDP figures was helped by thin trading volume, CNBC said, adding that Tuesday was a public holiday in Japan and many Western markets have slowed ahead of the long year-end break.
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On the New York Mercantile Exchange, February Brent crude was up by 1.48% to $61 at 1:00 p.m. in New York. West Texas Intermediate for February delivery was higher by 2.21% a barrel to $56.48.
Separately, TheStreet Ratings team rates UNITED STATES STEEL CORP as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate UNITED STATES STEEL CORP (X) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income and notable return on equity. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and poor profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- X's revenue growth has slightly outpaced the industry average of 3.6%. Since the same quarter one year prior, revenues rose by 11.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Metals & Mining industry. The net income increased by 88.4% when compared to the same quarter one year prior, rising from -$1,791.00 million to -$207.00 million.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. When compared to other companies in the Metals & Mining industry and the overall market, UNITED STATES STEEL CORP's return on equity has significantly outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
- The gross profit margin for UNITED STATES STEEL CORP is rather low; currently it is at 16.11%. Regardless of X's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, X's net profit margin of -4.51% significantly underperformed when compared to the industry average.
- Net operating cash flow has significantly decreased to -$106.00 million or 386.48% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- You can view the full analysis from the report here: X Ratings Report