In this article, we will take a look at the 5 best steel stocks to buy according to analysts. To read our analysis of the recent trends and market activity, you can go to the 10 Best Steel Stocks to Buy According to Analysts.
5. Radius Recycling, Inc. (NASDAQ:RDUS)
Average Analyst Rating: 2.00
Number of Hedge Fund Holders: 14
Ontario, Canada-based Radius Recycling, Inc. (NASDAQ:RDUS), formerly known as Schnitzer Steel Industries, Inc., is one of the largest manufacturers and exporters of recycled metal products in North America with operating facilities located in 25 states, Puerto Rico, and Western Canada.
On January 4, Radius Recycling, Inc. (NASDAQ:RDUS) released its financial results for the quarter ended November 30, 2023. It generated a revenue of $673 million and a net loss of $18 million. The Board of Directors of the company also declared a quarterly dividend of $0.1875 per share.
On our list of 10 best steel stocks to buy according to analysts, Radius Recycling, Inc. (NASDAQ:RDUS) has the highest upside potential based on the average analyst target price of $35.00 which is 45.83% more than the latest share price.
4. POSCO Holdings Inc. (NYSE:PKX)
Average Analyst Rating: 1.78
Number of Hedge Fund Holders: 9
Pohang, South Korea-based POSCO Holdings Inc. (NYSE:PKX) is a leading steel producer with operations across six continents. Its offerings include hot rolled steel, steel plates, wire rods, cold rolled steel, galvanized steel, automotive steel, stainless steel, and steelmaker.
On January 31, POSCO Holdings Inc. (NYSE:PKX) released its financial results for FY 2023. Its total revenue declined by 9% y-o-y to KRW 77.1 trillion, while net income shrunk 48% y-o-y to KRW 1.8 trillion.
As of Q4 2023, POSCO Holdings Inc. (NYSE:PKX) shares were held by 9 hedge funds with a total value of $13 million. Simon Sadler’s Segantii Capital was its largest hedge fund shareholder with ownership of 0.06 million shares valued at $5.5 million.
3. Ternium S.A. (NYSE:TX)
Average Analyst Rating: 1.55
Number of Hedge Fund Holders: 17
Ternium S.A. (NYSE:TX), based in Luxembourg, is a leading steel producer in Latin America with operating facilities in Mexico, Brazil, Argentina, Colombia, the southern United States and Central America.
In June 2023, Ternium S.A. (NYSE:TX) announced its intention to build and integrate its new steel slab mill at Pesquería, Nuevo León, Mexico, with construction expected to begin in December 2023. It expects to invest nearly $2.2 billion to construct an electric arc furnace-based steel shop with 2.6 million tons of annual capacity and a direct reduced iron with 2.1 million annual capacity. The facilities are expected to commence operations in H1 2026.
On November 20, BofA Securities upgraded Ternium S.A. (NYSE:TX) shares from ‘Neutral’ to ‘Buy’ rating with an unchanged price target of $47 per share which represents a potential upside of 18.03% based on the latest share price.
2. ArcelorMittal (NYSE:MT)
Average Analyst Rating: 1.53
Number of Hedge Fund Holders: 15
Luxembourg-based ArcelorMittal (NYSE:MT) is a leading steel and mining company with a presence in 60 countries and primary steelmaking facilities in 16 countries. The company produced 58.1 million metric tons of crude steel and 42.0 million metric tons of iron ore in 2023.
On February 8, ArcelorMittal (NYSE:MT) released its financial results for Q4 2023. It generated a revenue of $14.6 billion and a net loss of $3.0 billion. The Board of Directors of the company proposed to increase the annual base dividend to shareholders from $0.44 per share to $0.50, subject to the approval of shareholders.
ArcelorMittal (NYSE:MT) also reaffirmed its commitment to return a minimum 50% of post-dividend FCF to shareholders through its share buyback programs.
1. Worthington Steel, Inc. (NYSE:WS)
Average Analyst Rating: 1.00
Number of Hedge Fund Holders: 8
Based in Worthington, Ohio, Worthington Steel, Inc. (NYSE:WS) is a market-leading steel processor and producer of electrical steel laminations and automotive lightweighting solutions that partners with customers to deliver highly technical and customized solutions.
Worthington Steel, Inc. (NYSE:WS) was formed through a spin-off from Worthington Enterprises, Inc. (NYSE:WOR), formerly Worthington Industries, Inc., on December 1. The separation aims to promote a more focused strategic approach for both companies.
On December 4, KeyBanc analyst Philip Gibbs initiated coverage of Worthington Steel, Inc. (NYSE:WS) shares with an ‘Overweight’ rating and a price target of $29.
Worthington Steel, Inc. (NYSE:WS) is the best steel stock to buy according to analysts based on its average analyst ratings. The stock was owned by 8 prominent hedge funds as of December 31.
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