United States Steel (X) AI Stock Analysis

• Market Cap: $8.49B
• Dividend Yield: 0.51%
• Average Volume (3M): 5.68M
• Price to Earnings (P/E): 24.1
• Beta (1Y): 1.04
• Revenue Growth: -13.48%
• EPS Growth: -56.94%
• Country: US
• Employees: 22,053
• Sector: Basic Materials
• Sector Strength: 56
• Industry: Steel
• EPS (TTM): 1.49
• Shares Outstanding: 225,216,520
• 10 Day Avg. Volume: 4,103,920
• 30 Day Avg. Volume: 5,684,890
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.56
• Price to Cash Flow (P/CF): 10.50
• P/FCF Ratio: 9.80
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $40.17
• Price Target Upside: 7.26% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

United States Steel's overall stock score reflects the challenges in its financial performance, marked by volatility and cash flow management issues. The positive technical trends provide some optimism but are offset by high valuation levels and the negative impact of blocked merger plans. The strategic uncertainty from recent corporate events adds further caution to the stock's outlook.

Positive Factors

Operational Efficiency

The Big River Steel 2 mill continues to ramp-up and customer feedback on product quality is positive.

Strategic Partnerships

X can benefit from Nippon's cash infusion and technological aid.

Negative Factors

Regulatory Challenges

President Biden issued an order prohibiting the proposed acquisition of US Steel by Nippon Steel Corporation, citing national security concerns.

United States Steel Business Overview & Revenue Model

Company Description

United States Steel Corp. engages in the manufacturing and selling of steel products. It operates through the following business segments: Flat-Rolled Products, U.S. Steel Europe, and Tubular Products. The Flat-Rolled Products segment includes managing steel plants and production facilities that manufacture steel slabs, rounds, strip mill plates, sheets, tin mill, iron ore, and coke. The U.S. Steel Europe segment offers producing and marketing strip mill plates, spiral welded pipe, heating radiators, refractory ceramic materials. The Tubular Products segment involves in manufacturing and trading seamless and electric resistance welded steel casing and tubing. line pipe, and mechanical tubing. The company was founded in 1901 by Andrew Carnegie, John Pierpont Morgan, Charles Michael Schwab and Elbert Henry Gary and is headquartered in Pittsburgh, PA.

How the Company Makes Money

U.S. Steel generates revenue primarily through the sale of steel products. The company's key revenue streams include flat-rolled steel, tubular products, and the sale of raw materials like coke and iron ore. U.S. Steel's integrated steelmaking process allows it to produce a range of high-quality steel products, which are sold to customers in the automotive, construction, appliance, and energy sectors. Additionally, strategic partnerships and joint ventures, such as those in the mining and steel processing sectors, contribute to its earnings by enhancing operational efficiency and expanding market reach. The company's financial performance is also influenced by factors such as global steel demand, raw material prices, and trade policies.

United States Steel Financial Statement Overview

Summary

United States Steel has experienced significant volatility in its financial performance, characteristic of the cyclical steel industry. The income statement reflects inconsistent revenue and profit growth, while the balance sheet shows a strong equity position but declining return on equity. Cash flow has been unstable, with negative free cash flow growth, indicating challenges in capital expenditure management.

Income Statement

The company has shown a volatile revenue growth trajectory, with significant fluctuations over the years. While there was a substantial revenue and profit improvement from 2020 to 2021, recent years have shown a decline in revenue and profits. The gross profit margin and net profit margin have been inconsistent, reflecting the cyclical nature of the steel industry. The current EBIT and EBITDA margins suggest moderate profitability but with room for improvement compared to past years.

Balance Sheet

The balance sheet shows a strong equity position with a debt-to-equity ratio that has improved significantly over time. The return on equity has declined recently, indicating a reduction in profitability relative to equity. The equity ratio remains strong, suggesting a stable financial base, although total assets have not grown significantly.

Cash Flow

The company's cash flow performance has been unstable, with free cash flow showing negative growth in recent periods. Operating cash flow relative to net income indicates some operational cash generation capability. However, the free cash flow to net income ratio is concerning, highlighting cash flow challenges in capital expenditure management.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
15.64B	18.05B	21.07B	20.27B	9.74B
	Gross Profit
1.58B	2.25B	4.29B	5.74B	183.00M
	EBIT
240.00M	1.90B	3.31B	4.44B	-823.00M
	EBITDA
1.38B	2.04B	4.21B	5.45B	-384.00M
	Net Income Common Stockholders
384.00M	895.00M	2.52B	4.17B	-1.17B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.37B	2.95B	3.50B	2.52B	1.99B
	Total Assets
20.23B	20.45B	19.46B	17.82B	12.06B
	Total Debt
174.00M	4.34B	4.08B	4.03B	5.05B
	Net Debt
-1.19B	1.39B	578.00M	1.50B	3.06B
	Total Liabilities
8.79B	9.31B	9.15B	8.71B	8.18B
	Stockholders Equity
11.35B	11.05B	10.22B	9.01B	3.79B
Cash Flow		Free Cash Flow
-1.37B	-476.00M	1.74B	3.23B	-587.00M
	Operating Cash Flow
919.00M	2.10B	3.50B	4.09B	138.00M
	Investing Cash Flow
-2.28B	-2.57B	-1.68B	-840.00M	-563.00M
	Financing Cash Flow
-199.00M	-98.00M	-868.00M	-2.75B	1.58B

United States Steel Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 37.45
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For X, the sentiment is Neutral. The current price of 37.45 is below the 20-day moving average (MA) of 38.35, above the 50-day MA of 35.87, and above the 200-day MA of 37.22, indicating a neutral trend. The MACD of 0.56 indicates Positive momentum. The RSI at 49.74 is Neutral, neither overbought nor oversold. The STOCH value of 59.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for X.

United States Steel Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
STLD	75 Outperform	$18.98B	12.84	17.20%	1.46%	-6.68%	-32.96%
RS	74 Outperform	$14.90B	17.91	12.12%	1.52%	-6.56%	-31.89%
ATI	73 Outperform	$7.99B	22.01	19.88%	―	4.51%	-2.90%
NUE	73 Outperform	$29.86B	15.31	9.99%	1.68%	-11.46%	-53.29%
CMC	60 Neutral	$5.14B	40.74	3.32%	1.59%	-8.66%	-82.83%
X	57 Neutral	$8.49B	24.12	3.38%	0.51%	-13.48%	-56.94%
Sector *	47 Neutral	$2.64B	-4.00	-31.55%	3.33%	2.93%	-29.90%

United States Steel Corporate Events

U.S. Steel Merger with Nippon Blocked by Executive Order

United States Steel Corporation had previously entered into a merger agreement with Nippon Steel North America, which would result in U.S. Steel becoming a wholly owned subsidiary. However, the merger was prohibited by an executive order from the President of the United States, and a deadline was set for abandoning the merger, which has been extended to June 18, 2025.

United States Steel Challenges Merger Block in Court

United States Steel Corporation and Nippon Steel have initiated legal proceedings following the blocking of their merger by President Biden. The lawsuits challenge the legality of the President’s executive order and allege anticompetitive conduct by Cleveland-Cliffs. The companies argue that the merger would benefit the U.S. steel industry, and they are seeking judicial intervention to proceed with the transaction, promising substantial financial returns for stakeholders.

U.S. Steel’s Merger with Nippon Blocked by U.S.

United States Steel Corporation’s proposed merger with Nippon Steel Corporation has been prohibited by an order from the President of the United States. The decision, based on concerns over national security, requires both companies to permanently abandon the merger plans within 30 days, unless extended by CFIUS. This move significantly impacts U.S. Steel’s strategic operations and its potential industry positioning, as it restricts the company’s ability to complete a significant international merger.

U.S. Steel Releases Q4 2024 Guidance Amid Challenges

United States Steel Corporation has released its fourth quarter 2024 guidance, anticipating adjusted net earnings per diluted share between ($0.29) and ($0.25) and an expected adjusted EBITDA of approximately $150 million. The company highlights a challenging pricing environment, particularly in its North American Flat-Rolled and European segments. Nevertheless, U.S. Steel marks a significant milestone with the completion of $4 billion in growth capital investments, including the startup of the Big River 2 facility, which is expected to strengthen future earnings and cash flow. The company is facing pressure from ramp-related costs at Big River 2 and weak steel prices, but it continues to focus on resilience through a diverse product mix and rigorous cost management.