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Algoma Steel Group
(TSX:ASTL)
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Rating:49Neutral
Price Target:
C$6.50
▲(12.46% Upside)
Action:Reiterated
Date:08/25/26
The score is held down primarily by weak recent financial performance (large losses, higher leverage, and negative operating/free cash flow). The earnings call provides a partial offset via tangible EAF transition progress, improving mix/realization, and a path to lower transition costs, but near-term guidance points to a Q3 trough and continued cash burn. Technicals and valuation are mixed, with modest momentum signals but a still-weak trend and a negative P/E.
Positive Factors
EAF transition progress
The EAF platform is moving from implementation toward full operation, with Unit 1 running continuously and Unit 2 nearing start-up. Completing the transition should support lower emissions, improve operating consistency, and create a stronger foundation for capacity utilization and future green-steel demand.
Negative Factors
Severe profitability deterioration
The scale of the recent loss shows that Algoma’s current earnings base is not covering its operating burden during the downturn and transition. Persistently negative profitability can weaken retained capital, restrict investment flexibility, and make recovery dependent on successful execution and improved steel economics.
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Positive Factors
Negative Factors
EAF transition progress
The EAF platform is moving from implementation toward full operation, with Unit 1 running continuously and Unit 2 nearing start-up. Completing the transition should support lower emissions, improve operating consistency, and create a stronger foundation for capacity utilization and future green-steel demand.
Read all positive factors
Algoma Steel Group (ASTL) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$636.08M
Dividend Yield2.35%
Average Volume (3M)703.85K
Price to Earnings (P/E)―
Beta (1Y)1.99
Revenue Growth-32.82%
EPS Growth-259.39%
CountryCA
Employees2,400
SectorBasic Materials
Sector Strength58
IndustrySteel
Share Statistics
EPS (TTM)-9.19
Shares Outstanding105,661,470
10 Day Avg. Volume445,457
30 Day Avg. Volume703,852
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)1.25
Price to Sales (P/S)0.29
P/FCF Ratio-1.56
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$7.83Price Target Upside35.52% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)-3.3
Revenue Forecast (FY)C$1.14B
Algoma Steel Group Business Overview & Revenue Model
Company Description
Algoma Steel Group Inc. is a North American producer and vendor of various steel products. The company supplies an array of flat and sheet steel materials, including temper rolled, cold rolled, hot-rolled pickled and oiled, floor plate, and cut-to...
How the Company Makes Money
Algoma Steel makes money by producing and selling steel products to industrial customers, with revenue primarily driven by the volume of steel shipped and the realized selling price per ton (or per unit) across its product mix. Its key revenue str...
Algoma Steel Group Earnings Call Summary
Earnings Call Date:Jul 29, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 04, 2026
Earnings Call Sentiment Neutral
The call presents a mixed but improving picture: the company achieved a positive adjusted EBITDA headline, set consecutive record plate shipments, materially reduced tariff costs and advanced its EAF transition (Unit 2 nearing start-up), and maintains liquidity with expected near-term tax refunds. However, the quarter also showed large year-over-year declines in shipments and revenue, elevated per-ton costs during the ramp, significant operating losses and near-term downtime that will depress Q3 volumes. Several benefits (insurance proceeds, capacity adjustments) are non-recurring or in the process of being eliminated. Overall, the company appears to be progressing through a challenging but managed transformation with tangible signs of operational and financial improvement, while substantial transition-related headwinds remain.Positive Updates
Positive Adjusted EBITDA and Margin
Adjusted EBITDA of $13.8 million in Q2 2026, representing a 5.2% adjusted EBITDA margin; includes $45.0 million insurance proceeds and a $54.7 million capacity utilization adjustment. On an apples-to-apples basis excluding the insurance benefit, adjusted EBITDA was a loss of ~$31 million, but results improved sequentially when excluding both insurance and capacity adjustments (improvement of ~ $33 million).
Negative Updates
Large Year‑Over‑Year Decline in Shipments and Revenue
Consolidated shipments fell to 181,000 tons from 472,000 tons year-over-year (-61.7%). Consolidated revenue declined to $267.5 million from $589.7 million (-54.7%) versus Q2 2025, reflecting the transition to EAF and pivot away from U.S. volumes.
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Q2-2026 Updates
Positive
Negative
Positive Adjusted EBITDA and Margin
Adjusted EBITDA of $13.8 million in Q2 2026, representing a 5.2% adjusted EBITDA margin; includes $45.0 million insurance proceeds and a $54.7 million capacity utilization adjustment. On an apples-to-apples basis excluding the insurance benefit, adjusted EBITDA was a loss of ~$31 million, but results improved sequentially when excluding both insurance and capacity adjustments (improvement of ~ $33 million).
Read all positive updates
Company Guidance
The company’s forward-looking guidance emphasized that Q2 results (181,000 tons shipped, 125,000 tons plate; average net sales realization $1,361/ton; cost per ton $1,411 excluding a $54.7M capacity-utilization adjustment; adjusted EBITDA $13.8M, 5.2% margin, which included a $45M insurance benefit) are on the transition path and that Q3 will be the trough as Unit 2 is tied in (first steel later this quarter) with scheduled downtime and shipments expected to be directionally down 10–20%; the $54.7M capacity-utilization adjustment (down from $90.2M in Q1) is on track to be fully eliminated by Q4, supporting improved per‑ton costs as volumes ramp, with an expected 2027 exit run‑rate of 1.5–2.0 Mt (full facility capacity ~3.7 Mt) and a planned ~600k tons of plate production next year; liquidity and cash flow items cited to fund the ramp include ending cash $62.6M, $206.7M unused revolver, $168M LETL availability (after a $124.5M draw), total available liquidity ~$437M, $79.4M cash used in operations in Q2, a $26M inventory release in the quarter, and an anticipated ~$200M of income tax refunds.Algoma Steel Group Financial Statement Overview
Summary
Income Statement
18
Very Negative
Balance Sheet
34
Negative
Cash Flow
22
Negative
| Breakdown | TTM | Dec 2025 | Dec 2025 | Mar 2023 | Mar 2022 | Mar 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.09B | 2.09B | 2.45B | 2.80B | 2.78B | 3.81B |
| Gross Profit | -665.00M | -664.80M | -162.40M | 282.30M | 389.80M | 1.51B |
| EBITDA | -814.70M | -859.60M | -72.80M | 278.40M | 489.30M | 1.29B |
| Net Income | -984.90M | -984.90M | -222.67M | 105.20M | 298.50M | 857.70M |
Balance Sheet | ||||||
| Total Assets | 2.12B | 2.12B | 3.19B | 2.68B | 2.46B | 2.69B |
| Cash, Cash Equivalents and Short-Term Investments | 77.60M | 77.50M | 267.00M | 97.90M | 247.40M | 915.30M |
| Total Debt | 916.90M | 862.00M | 659.60M | 146.10M | 122.30M | 96.20M |
| Total Liabilities | 0.00 | 1.62B | 1.68B | 1.17B | 993.40M | 1.11B |
| Stockholders Equity | 491.10M | 491.10M | 1.51B | 1.50B | 1.46B | 1.58B |
Cash Flow | ||||||
| Free Cash Flow | -361.20M | -394.60M | -362.70M | -195.50M | -156.20M | 1.10B |
| Operating Cash Flow | -63.10M | -66.10M | -62.60M | 294.60M | 177.30M | 1.26B |
| Investing Cash Flow | -282.61M | -312.30M | -272.20M | -490.10M | -333.50M | -165.70M |
| Financing Cash Flow | 93.42M | 200.80M | 483.70M | 44.70M | -569.60M | -198.70M |
Algoma Steel Group Technical Analysis
Neutral
5.78
Price Trends
5.77
Positive
6.25
Negative
6.09
Negative
Market Momentum
0.06
Negative
50.80
Neutral
63.22
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ASTL, the sentiment is Neutral. The current price of 5.78 is below the 20-day moving average (MA) of 6.00, above the 50-day MA of 5.77, and below the 200-day MA of 6.09, indicating a neutral trend. The MACD of 0.06 indicates Negative momentum. The RSI at 50.80 is Neutral, neither overbought nor oversold. The STOCH value of 63.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:ASTL.
Algoma Steel Group Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | C$318.58M | 6.55 | 13.35% | 6.84% | -5.88% | 225.50% | |
72 Outperform | C$1.67B | 21.21 | 12.04% | 5.26% | -15.44% | -32.07% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
59 Neutral | C$1.43B | 6,366.75 | 0.21% | 1.34% | 23.69% | ― | |
58 Neutral | C$903.64M | -2.11 | -30.64% | 6.38% | -7.37% | -92.84% | |
49 Neutral | C$636.08M | -0.58 | -220.30% | 2.35% | -32.82% | -259.39% | |
47 Neutral | C$71.34M | -10.51 | -6.25% | 2.15% | -17.61% | -35.19% |
* Basic Materials Sector Average
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Algoma Steel Group Corporate Events
Business Operations and Strategy
Algoma Steel Restores EAF Output Under Interim Power Arrangements After LSP Outage
Positive
Sep 2, 2026
Algoma Steel Group has provided an operational update following the unplanned outage at its Lake Superior Power generating facility, which had affected its electric arc furnace operations. Working with the Independent Electricity System Operator, ...
Business Operations and Strategy
Algoma Steel Halts Electric Arc Furnace After Lake Superior Power Turbine Outage
Negative
Aug 18, 2026
Algoma Steel Group has reported an unplanned outage at its Lake Superior Power generating facility after one turbine unit detected an abnormal condition and went offline, although the remaining units are unaffected. As LSP supplies electricity to ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.