Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of AK Steel (NYSE:AKS) fell 16% today after reporting disappointing earnings outlook.

So what: The company said it would be reporting a loss for the fourth quarter but no one expected an outlook of $0.67-$0.72 per share in losses. The company said that steel prices may fall 5% to drive the loss.  

To make matters worse, the company is offering $475 million in debt and 25-million shares of stock in new offerings.

Now what: The bad outlook isn't positive but the company will add almost 25% to its shares outstanding with the share offering. Considering both factors, I think this is a stock I would stay far away from. Operating trends are heading in the wrong direction and I don't see any value in a company that's continually losing money.

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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.