The economy is barely ticking, and holding a commodity producer right now is risky. U.S. Steel (X) is going to report a loss this year, but hey — supposedly it’s going soundly back to profitability next year.
I’m not so sure.
U.S. Steel has $3 billion in debt and is barely generating any FCF. Meanwhile, everyone’s cheering a supposed rebound in steel … but X shares have also rebounded 40% in just a few months, putting the cart before the horse.
At $27, U.S. Steel is trading at a valuation that’s just not supportable.