Cheap Stocks to Buy Now: AK Steel (AKS)
Relatively sluggish economic growth hasn’t been too kind for steel makers either. The slowdown has resulted in plenty of cheap stocks in the sector. And one of the best turnarounds could be AK Steel (AKS).
After several quarters of hard losses, AKS finally managed to turn a profit of $35.2 million, beating analyst expectations by 4 cents per share. The key for the steel stock was lower input costs for the firm. Prices for scrap steel, coking coal, iron ore and natural gas all showed lower averaged prices for the quarter. That helped AKS stock in the earnings department.
AKS stock could build on that momentum.
AKS expects that its iron ore costs will continue to drop as its investment in its Magnetation pellet plant will begin production. That facility will supply AKS with cheap iron ore beginning in the second half of the year. Meanwhile, AKS chief end-users — U.S. automotive firms — have finally begun to ramp up production. That should help AKS sales and ultimately prices for steel.
At just $6.50, AKS is still one of the cheap stocks, but it may not be cheap for long.