Commodities & Metals

US Steel and Aluminum Companies Enjoy a Big Trump Bump

Jon C. Ogg

Published: March 1, 2018 1:00 pm

Last Updated: January 12, 2020 2:52 am

If there is one thing that can create an instant unilateral gain in a sector, government protection can do just that. President Donald Trump has announced new tariffs on Thursday aimed at protecting the U.S. steel and aluminum industries.

A tweet from this morning from the president:

Our Steel and Aluminum industries (and many others) have been decimated by decades of unfair trade and bad policy with countries from around the world. We must not let our country, companies and workers be taken advantage of any longer. We want free, fair and SMART TRADE!

— Donald J. Trump (@realDonaldTrump) March 1, 2018

President Trump has confirmed that tariffs would be coming, at a rate of 25% for steel imports and 10% for aluminum imports, starting in the days ahead. The president widely expected to issue new tariffs to protect steel and aluminum companies. Not all the companies had risen in anticipation of the news, but almost all of them saw their stocks rise on Thursday morning.

24/7 Wall St. has tracked multiple stocks tied to steel and aluminum, and most of them were surging on Thursday morning. That said, some lagged others, and some were not even up on the day. We have tracked how some of these companies are still down from the highs seen earlier this week, and we have also tracked longer trading history over the last year. Consensus analyst price target data came from the Thomson Reuters sell-side estimates.

The following share prices are based on reactions to the morning’s news, and they will be updated after the close of trading on Thursday.

United States Steel Corp. (NYSE: X) closed up 5.8% at $46.01, and this was a $43.50 stock earlier in the week. U.S. Steel has a 52-week trading range of $18.55 to $46.82 and consensus analyst price target of $44.23. Its market cap is $8.0 billion.

Nucor Corp. (NYSE: NUE) closed up 3.1% at $67.53, but it was trading near $68 earlier in the week. Nucor has a 52-week range of $51.67 to $70.48 and a consensus price target of $73.77. Its market cap is $21.2 billion.

Steel Dynamics Inc. (NASDAQ: STLD) closed up 4.0% at $48.10, though that’s down from $48.50 earlier in the week. The 52-week range is $32.15 to $50.70, and the consensus price target is $52.08. Its market cap is $11.1 billion.

Reliance Steel & Aluminum Co. (NYSE: RS) closed up 3.8% at $93.62, after having been up at $93.00 earlier in the week. Reliance Steel has a 52-week range of $68.46 to $95.97. Its consensus price target is $98.38, and its market cap is $6.6 billion.

Worthington Industries Inc. (NYSE: WOR) closed up 1.1% at $44.70, but it had been as high as almost $47 this week. The 52-week range is $39.52 to $53.27, and the consensus analyst target is $49.50. Its market cap is $2.7 billion.

24/7 Wall St.
Is the Great Lithium Boom Already Facing Its Demise?

Allegheny Technologies Inc. (NYSE: ATI) was not up on Thursday, as its shares were down 1.2% to $25.61, after having been above $27 earlier in the week. Allegheny Tech has a 52-week range of $14.54 to $30.25. The consensus price target is $33.29, and the market cap is $3.2 billion.

Alcoa Inc. (NYSE: AA) was up 0.2% to $45.07. This was a $47.50 stock last Friday. It has a 52-week range of $29.55 to $57.50 and consensus price target of $61.64. Its market cap is $8.3 billion.

Arconic Inc. (NYSE: ARNC) closed up 1.5% at $24.02, and this stock traded at $25.25 earlier in the week. Arconic has a 52-week range of $21.76 to $31.17. The consensus price target is $30.43. The market cap is $11.8 billion.

Commercial Metals Co. (NYSE: CMC) closed up 5.0% at $25.51, and it was up at $25.50 earlier in the week. The 52-week range is $17.05 to $26.72, and the consensus price target is $26.63. Its market cap is $2.9 billion.

Cleveland-Cliffs Inc. (NYSE: CLF) closed up 10.2% at $7.75, after having been up at $7.70 at the start of this week. Cleveland-Cliffs has a 52-week range of $5.56 to $10.87 and a consensus price target of $7.88. Its market cap is $2.2 billion.

AK Steel Holding Corp. (NYSE: AKS) was one of the top winners, since it has been considered a turnaround stock that can use all the help it can get. Its shares were up 9.5% at $5.65, in a 52-week range of $4.00 to $8.74. The consensus price target is $6.39, and the market cap is $1.7 billion.

Schnitzer Steel Industries Inc. (NASDAQ: SCHN) closed up 2.1% at $34.70, but it was up at $35.70 on Monday. The 52-week range is $17.50 to $38.85, and the consensus price target is $36.50. It has a market cap of $907.2 million.

Timkensteel Corp. (NYSE: TMST) was up 3.0% at $16.85, challenging its weekly highs. It has a 52-week range of $12.48 to $22.83 and a market cap of $760 million. Its consensus target price is $18.63.

Kaiser Aluminum Corp. (NASDAQ: KALU) closed up 1.4% at $101.81, but it was a $105 stock just two days earlier. The shares have a 52-week range of $74.56 to $116.86 and a consensus price target of $108.14. The market cap is $1.7 billion.

Century Aluminum Co. (NASDAQ: CENX) closed up a sharp 7.5% at $20.48, but it was a $21 stock last Friday. Shares have traded between $11.26 and $24.77 in the past year. Analysts have a consensus price target of $19.40. The market cap is $1.7 billion.

24/7 Wall St.
4 Steel and Mining Stocks to Buy That Should Benefit From US Infrastructure Plan

And in a round of near humor, the VanEck Vectors Steel ETF (NYSEARCA: SLX) closed up 1.1% at $49.77. Why this is almost funny is that the exchange traded fund’s top 10 holdings are largely made up of non-domestic companies. Some of those companies of course have U.S. operations, but their main parent companies and others might face more barriers to selling into the United States. This ETF has a 52-week trading range of $35.03 to $51.91. As of February 28, the fund had only $179 million in total assets.

As a reminder, it is important to understand that tariffs act to protect a company’s business within a home country. If a trade war erupts with retaliatory tariffs as a result, then the gains primarily only help the companies that actually are focused on the domestic market and they will be the winners. Of course, trade wars are rarely viewed as a good thing in the history books.