AK Steel Holding Corporation (AKS) Buy or Sell Stock Guide
Are you looking for the analysis of AK Steel Holding Corporation (AKS) stock? Are you wondering what the bulls and the bears say about it?
If so, you came to the right place. In this stock guide, we will share with you 9 reasons to buy and 6 reasons to sell AKS stock. You’ll get a perspective on what the bulls and the bears say about it.
The analysis below may be also helpful to you if you have any of the following questions about AKS stock:
- Is AKS a buy or a sell?
- Should I sell or hold AKS stock today?
- Is AKS a good buy / investment?
- What are AKS analyst opinions, recommendations and ratings?
Let’s start with the bull case. Here are the reasons to buy AKS stock:
1. Investments in iron ore and metallurgical coal assets provide the company with more control over input costs.
2. The company’s production of value-added products that it can deliver on a just-in-time basis limits competition from imports.
3. AK Steel will benefit from growth in the North American auto market, which accounts for more than half of its total sales.
4. AKS quarterly revenue growth was 12.10%, higher than the industry and sector average revenue growth (9.82% and 2.83%, respectively). See AKS revenue growth chart.
5. AKS profitability is improving. The YoY profit margin change was 2.63pp. See AKS profitability chart.
6. AKS forward P/E ratio is 6.20, and it’s low compared to its industry peers’ P/E ratios. See AKS forward P/E ratio chart.
7. AKS Price/Sales ratio is 0.13, and it’s low compared to its industry peers’ P/S ratios. See AKS forward Price/Sales ratio chart.
8. AKS PEG ratio (P/E adjusted for growth) is 0.33, and it’s low compared to its industry peers’ PEG ratios. See AKS PEG chart.
9. AKS average analyst price target ($2.96) is above its current price ($2.54). See AKS price target chart.
Now that you understand the bull case, let’s look at the reasons to sell AKS stock (i.e., the bear case):
1. The company’s efforts to vertically integrate will yield little benefit, since iron ore spot prices have declined significantly.
2. Aluminum might take share from steel in the automotive market, weighing on the company's shipment volume.
3. The company is highly leveraged to the automotive end market, so weak North American auto sales will weigh heavily on earnings.
4. AKS Price/Book ratio is 8.99, and it’s high compared to its industry peers’ P/B ratios. See AKS forward Price/Book ratio chart.
5. AKS short share of float is 20.37%. The stock is much more frequently shorted than the average industry, sector or S&P 500 stock. See AKS short share of float chart.
6. AKS short interest (days to cover the shorts) ratio is 5.73. The stock garners more short interest than the average industry, sector or S&P 500 stock. See AKS short interest ratio chart.
Now let's look at the key statistics for AKS:
|Average Price Target / Upside||$2.96 / 25.16%|
|Average Analyst Rating||Hold|
|Number of Employees||9,500|
|Forward P/E Ratio||5.33|
|YoY Quarterly Revenue Growth||12.1%|
What are your thoughts on AKS?
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