U.S. Steel (X) Prices Public Offering Of 18.9 Million Shares

United States Steel Corporation (NYSE:X) said that it has priced its underwritten public offering of about 18.9 million shares of common stock at a public offering price of $23 per share, for total gross proceeds of roughly $434.7 million. The offering was upsized to 18.9 million shares from 17 million shares announced earlier.

U.S. Steel has granted a 30-day option to the underwriters to purchase up to 2,835,000 additional shares of common stock from the company. This offering is expected to close on or about Aug 15, 2016, following the customary closing conditions. The company plans to utilize the net proceeds from this offering for financial flexibility, capital expenditures and other general corporate purposes.

U.S. Steel reported a narrower loss of $46 million or 32 cents per share in second-quarter 2016, benefiting from better market conditions. The steel giant had recorded a loss of $261 million or $1.79 per share a year ago.
Barring one-time items, loss was 31 cents per share for the reported quarter, narrower than the Zacks Consensus Estimate of a loss of 55 cents.

Revenues tumbled roughly 10.9% year over year to $2,584 million in the second quarter, hampered by lower year-over-year selling prices. Sales also missed the Zacks Consensus Estimate of $2,663 million. Total steel shipments remained relatively flat year over year in the quarter.

In the reported quarter, U.S. Steel fared better than the prior-year quarter as well as the preceding quarter. Market conditions improved and the company’s European segment recorded solid results since third-quarter 2008. Management’s focus on improving the cost structure also led to an improvement in margins.

U.S. Steel currently has a Zacks Rank #3 (Hold).

Better-ranked stocks in the steel industry include ArcelorMittal (NYSE:MT) , Schnitzer Steel Industries, Inc. (NASDAQ:SCHN) , ThyssenKrupp AG (OTC:TYEKF) – all of them sporting a Zacks Rank #1 (Strong Buy).