#4 Worst S&P Stock: Allegheny Technologies
Allegheny Technologies Incorporated (NYSE:ATI) is a small-cap specialty metals producer worth about $3 billion. The company’s products include titanium and specialty steel alloys, among other things, used in a wide array of high-tech capacities that include jet engines.
It goes without saying that the recession wasn’t kind to materials stocks like Allegheny. Demand fell off a cliff as sales of durable goods and machinery dried up. There was a resurgence in shares across 2010 and 2011 on hopes of a recovery, but recent troubles in Europe and fears of a double-dip at home have battered this stock.
Fundamentally, ATI isn’t all that bad these days. It has seen nine straight quarters of year-over-year revenue increases and is tracking a nearly 50% jump in earnings per share for fiscal 2012 over fiscal 2011.
But materials stocks just can’t catch a break right now, whether they be big players like Alcoa (NYSE:AA) or smaller fish like ATI. These companies are cyclical and driven by broad demand trends, and investors just aren’t confident that demand will be there amid global economic troubles.