United States Steel Corp. Earnings Cheat Sheet: Profit Swings Up and Beats Forecast

S&P 500 (NYSE:SPY) component United States Steel Corporation (NYSE:X) reported its results for the third quarter. United States Steel is an integrated steel producer of flat-rolled and tubular products.

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United States Steel Earnings Cheat Sheet for the Third Quarter

Results: Reported a profit of $22 million (15 cents per diluted share) in the quarter. United States Steel Corporation had a net loss of $51 million or a loss 35 cents per share in the year earlier quarter.

Revenue: Rose 13% to $5.08 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: X reported adjusted net income of 72 cents per share. By that measure, the company beat the mean estimate of 55 cents per share. Analysts were expecting revenue of $5.07 billion.

Quoting Management: U. S. Steel Chairman and CEO John P. Surma said, “Our operating results for the third quarter reflected strong performances by our Flat-rolled and Tubular segments. Our Flat-rolled segment made more than $200 million despite the challenges of a less than robust economy in North America. Tubular segment results improved significantly compared to the second quarter, driven by increased shipments, improved average realized prices and lower substrate costs. U. S. Steel Europe results continue to reflect the difficult economic situation in Europe, particularly in Southern Europe.”

Key Stats:

Revenue has risen the past four quarters. Revenue increased 9.4% to $5.12 billion in the second quarter. The figure rose 24.8% in the first quarter from the year earlier and climbed 28.2% in the fourth quarter of the last fiscal year from the year-ago quarter.

The company has now beaten estimates the last two quarters. In the second quarter, it topped expectations with net income of $1.33 versus a mean estimate of net income of $1.26 per share.

Gross margins grew 6.3 percentage points to 10.3%. The growth seemed to be driven by increased revenue, as the figure rose 13% from the year earlier quarter while costs rose 5.5%.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 88 cents a share to 24 cents over the last ninety days. At $1.02 per share, the average estimate for the fiscal year has fallen from $2.48 ninety days ago.

Competitors to Watch: AK Steel Holding Corp. (NYSE:AKS), Steel Dynamics, Inc. (NASDAQ:STLD), Nucor Corporation (NYSE:NUE), ArcelorMittal (NYSE:MT), Worthington Industries, Inc. (NYSE:WOR), POSCO (NYSE:PKX), Ternium S.A. (NYSE:TX), Mechel OAO (NYSE:MTL), and Companhia Siderurgica Nacional (NYSE:SID).

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(Source: Xignite Financials)