Shares of AK Steel Holding Corp (NYSE:AKS) nosedived Tuesday in premarket trading after the company missed second quarter profit estimates although revenues were in line with expectations.
The West Chester, Ohio-based steel maker reported earnings of $0.22 per share, missing Wall Street estimates of US$0.23 per share. Its reported revenues were in line with expectations at US$1.75bn for its second quarter. Revenue grew 12.2% on a year-over-year basis.
Investors who expected the company to benefit from US tariffs on imported steel punished the stock sending it lower 8.8% to US$4.89 in premarket trade.
President Donald Trump joins a long list of presidents going back to Richard Nixon who’ve sought to use tariffs and other protectionist measures to protect a long-ailing US steel industry which peaked decades ago.
The company anticipates that market conditions will remain strong in the third quarter.
“We expect that the continued strong business environment will result in improved performance in the second half of 2018 compared to the first half and position us well for resetting a majority of our annual contracts later this year,” said AK Steel CEO Roger K Newport.
The company said it expects an increase in flat-rolled shipments in the third quarter of approximately 5% compared to the second quarter.
AK Steel is a producer of flat-rolled carbon, stainless and electrical steel products, for the automotive, infrastructure, manufacturing, electrical power industries.
Contact Uttara Choudhury at uttara@proactiveinvestors.com
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