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4 Stocks That Are Going Nowhere But Down

Each of these stocks to short struggles with its own challenges

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Stocks to Short #1: United States Steel Corp (X)

USSteelLogo 4 Stocks That Are Going Nowhere But DownUnited States Steel Corp (X) is battling the biggest problem a company like it can have: cheaper competition — in this case, from overseas.

Steel prices have come up off their April lows, but are expected to drop again because of this competition. U.S. steel price premiums are nearing a high compared to Chinese imports. In addition, several steel mills had outages during the first half of this year, but they have been repaired — that means more supply coming onto the market.

U.S. Steel sits on $1.3 billion in cash and long-term investments but is offset by $3.6 billion in debt. The debt isn’t cheap, averaging around 6.4% in interest, which translates to a little more than $200 million in interest payments annually. X stock is barely breaking even on an operational basis, and the debt payments drive the company into the red.

X stock is a stock to short.


Article printed from InvestorPlace Media, http://investorplace.com/2013/12/4-stocks-to-short/.

©2014 InvestorPlace Media, LLC

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