US Steel Stock surges after beating earnings and increasing dividend

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Steel sheet rolls.

Allison Farrand / Bloomberg

American steel

stocks were skyrocketing after hours of trading after the company not only crushed third-quarter earnings expectations, but also raised its dividend.

Stocks rose more than 6% in after-hours trading after rising 0.3% in regular trading on Thursday. The

S&P 500


Dow Jones Industrial Average

gained 1% and 0.7% respectively.

US Steel reported adjusted earnings per share of $ 5.36 on revenue of $ 6 billion. Wall Street was looking for earnings of $ 4.87 per share and $ 5.8 billion in sales.

The company shipped 4.1 million tonnes of steel in the third quarter, up from 3 million tonnes a year ago.

Management adopted an optimistic tone in its press release. “We continue to set records, including record net income, record Ebitda, record EBITDA margin, record liquidity, record security, and record quality and reliability,” said CEO David Burritt . “Our balance sheet has changed and the company’s cash flow generation gives us great confidence in our ability to pre-finance organic growth investments. ”

Separately, the company announced that it would repurchase $ 300 million of shares and increased the quarterly dividend from 1 cent to 5 cents per share.

The earnings and dividend news – and the initial stock price reaction – are positive for shareholders who have watched US Steel shares move in recent months. As of Thursday’s close, stocks were up about 38% year-to-date. But stocks have fallen about 6% in the past three months.

This model tracks steel prices. Hot-rolled coil prices, a key benchmark, have increased by around 75% since the start of the year, but have fallen by around 5% in the past three months. Commodity prices often determine what happens to commodity-related stocks, at least in the short term.

Management is holding a conference call Friday morning at 8:30 a.m. Eastern Time to discuss the results.

Write to Al Root at [email protected]

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