October 07, 2008

US Steel shares surge

AP reported that shares of United States Steel Corp rose sharply Thursday after two analysts said the company is able to buy iron, from which it makes steel, at one of the industry's lowest costs.

Mr Aldo Mazzaferro analyst at Goldman Sachs raised his rating on the stock to Buy from Neutral and increased his price target to USD 150 per share from USD 128. He in a client note said that the company has high sensitivity to steel pricing and low input cost exposure.”

Mr Charles A Bradford analyst at Soleil Securities Group also raised his price target to USD 110 from USD 105 and kept a Hold rating on the shares. He in a client note said that "US Steel may be the lowest cost flat rolled steelmaker in the US given its strong iron ore position and major coke-making operations. We expect the company to experience single digit cost increases, which compares with the recent pellet deal between Vale and Ilva of Italy that will increase prices by 86.7% for fiscal 2008."