ArcelorMittal Continues To Reduce Steel Production In Europe

ArcelorMittal (NYSE:MT) recently announced that will undertake additional steps for adjusting its European production levels. The move will enable the company to align its production to the present market demand.

ArcelorMittal is affected by higher import levels and weak market demand in Europe. As such, it will reduce primary steel production in its facilities in Eisenhuttenstadt, Germany and Dunkirk, France.

Moreover, it will lower the primary steel production at its Bremen facility during the fourth quarter of 2019. A planned blast furnace stoppage for repair works will be extended at the facility. The company will also extend the planned stoppage at its facility in Asturias, Spain in the fourth quarter to repair a blast furnace.

Per management, the current decisions to reduce primary production in the region will be reversed when market conditions improve.

It may be noted here that on May 6, 2019, the company announced plans to temporarily idle production at the steelmaking facilities in Krakow, Poland and reduce the same in Asturias, Spain. The decision affected the planned increase of shipments at ArcelorMittal Italia to an annual run-rate of 6 million tons due to a slow down stemming from the company’s move to optimize quality and cost over volume in the current scenario.

ArcelorMittal’s shares have plunged 51.9% in the past year compared with 40.8% decline of the industry.

Zacks Rank & Key Picks

ArcelorMittal currently carries a Zacks Rank #5 (Strong Sell).

Some better-ranked stocks in the basic materials space are Materion Corporation (NYSE:MTRN) , L.B. Foster Company (NASDAQ:FSTR) and AngloGold Ashanti Limited (NYSE:AU) , all currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Materion has an expected earnings growth rate of 27.3% for 2019. The company’s shares have gained 15.5% in the past year.

L.B. Foster has a projected earnings growth rate of 65.8% for the current year. The company’s shares have gained 4.6% in a year’s time.

AngloGold has an estimated earnings growth rate of 90.6% for the current year. Its shares have rallied 33.9% in the past year.

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