BMO Capital analyst Katja Jancic upgraded U.S. Steel to Outperform from Market Perform with a price target of $45, up from $43. The Nippon – U.S. Steel transaction remains in limbo, with ongoing opposition from the USW and elevated political pressure translating to high likelihood the deal does not get completed in the current form, but the stock looks “fundamentally undervalued” given the firm’s view that U.S. Steel’s investments in the Mini-Mill/EAF asset should translate to improved profitability and free cash flow generation through-cycle, the analyst tells investors in a research note. The stock is also currently trading at 5.1- and 4.2-times expected 2025 and 2026 EBITDA respectively vs. U.S. peer average of 7.5- and 7.0-times, the firm added.
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