In a report released yesterday, Chris LaFemina from Jefferies reiterated a Buy rating on United States Steel (X – Research Report), with a price target of $50.00.
Chris LaFemina has given his Buy rating due to a combination of factors including the company’s better-than-expected financial performance and promising future outlook. United States Steel reported a first-quarter adjusted EBITDA of $172 million, surpassing both the firm’s estimates and previous guidance, primarily due to stronger results in the Flat Rolled and European operations. Despite a rise in net debt, the company is expected to achieve higher earnings and positive free cash flow in the second quarter, driven by improved pricing in key segments.
Furthermore, the potential for strategic changes within the company adds to the positive outlook, as reflected in the increased price target from $48 to $50. The analyst acknowledges the risks associated with the company’s rising debt but remains optimistic about its future cash flow and earnings trajectory. The valuation metrics, including a 2026 estimated P/E ratio of 12.2x and a free cash flow yield of 12.3%, support the Buy rating, indicating a favorable investment opportunity.
X’s price has also changed moderately for the past six months – from $38.630 to $43.460, which is a 12.50% increase.