What: Shares of Allegheny Technologies Incorporated (NYSE:ATI) fell as much as 12.5% early Wednesday after the specialty metals company issued disappointing second-quarter guidance.

So what: Citing "challenging business conditions in its Flat Rolled Products business and further weakening in demand from the oil and gas market," Allegheny now expects to report a quarterly net loss of $16 million to $18 million, or $0.15 to $0.17 per share. Analysts, on average, were expecting Allegheny to achieve net income of $0.20 per share.

Now what: Investors should expect more clarification during Allegheny's next quarterly call on July 21, 2015. But in the meantime, this will mark the sixth quarterly operating loss in the past eight quarters for the Flat Rolled Products segment. For that, Allegheny says investors can thank continued declines in base selling prices for standard stainless-steel sheet products, following both a surge in less expensive imports from China and  "aggressive inventory reductions by distribution customers." And in the oil and gas industry, demand was significantly weaker than expected for both ATI's specialty materials, used in exploration applications, and drilling and flow equipment. 

Though the stock might look enticing trading around 11 times next year's estimated earnings, I won't be the least bit surprised if those estimates come down as Wall Street has time to fully digest today's news. As a result, I'm inclined to avoid Allegheny Technologies until the dust settles and the business shows signs of rebounding.