It's easy to see that the metals markets have come in a variety of colors -- or conditions -- as they report their third quarter results.
As is typically the case, Alcoa
Now the steel companies are reporting, and the results are uniformly far from attractive. For instance, U.S. Steel
But U.S. Steel isn't alone in its dilemma. Also on Tuesday, Luxembourg-based ArcelorMittal
The beat goes on: Nucor Corp.
There clearly are several factors tamping down steel manufacturing profits: Demand is down in the automobile and construction sectors -- and elsewhere -- prices remain under pressure, and the costs of ore and coal continue to rise.
During U.S. Steel's Tuesday call with analysts, CFO Gretchen Haggerty predicted that, "Fourth quarter results for flat-rolled are expected to be in line with the third quarter." And looking at the company's other two areas of operation, she forecast that, "… fourth quarter results for U.S. Steel Europe (will) be comparable to the third quarter …" At the same time, she stated that, "We expect our tubular segment (primarily applied to the energy) to remain profitable in the fourth quarter, but we do expect lower results as compared to the third quarter."
It's hard, then, to find many positives among the steel producers, including U.S. Steel. As such, Foolish investors would be better served by looking to other metals companies such Freeport-McMoRan.
We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Fool contributor David Lee Smith doesn't own shares in any of the the above-named companies. The Motley Fool has a disclosure policy.