There’s an old Wall Street adage that says the best time to buy is when there’s blood in the streets. For United States Steel Corporation X investors, the streets have gotten pretty darn bloody.

U.S. Steel’s share price is now down 38.6 percent in the last three months after the company reported Q1 earnings that were disappointing to say the least. However, Jefferies analyst Seth Rosenfeld says investors should step in and buy U.S. Steel on the dip despite what he calls an “abysmal” quarter.

According to Rosenfeld, things can’t get much worse for U.S. Steel than they did in Q1.

“We underestimated elevated risks inherent with X’s ‘revitalization’ efforts as well as cost headwinds in 1Q17 and shares have hastily sold off post results/guide as bullish sentiment capitulated,” he explained.

Jefferies gives three reasons why U.S. Steel is now a bargain:

• 1. The company’s guidance suggests earnings upside ahead.
• 2. The majority of negative operational headwinds have now passed.
• 3. Quarter-over-quarter cost increases will be minimal.

Rosenfeld said improvements in flat rolled price-volumes should produce quarter-over-quarter EBITDA growth of $229 million in the coming quarter compared to just $9 million in Q1.

While Jefferies was forced to cut its full-year EBITDA estimates by $555 million to $1.120 billion, Rosenfeld points out…

Click here to continue reading

Want to learn more about how to profit off the stock market? Or maybe you just want to be able to look sophisticated in front of your coworkers when they ask you what you are reading on your Kindle, and you’d prefer to tell them “Oh, I’m just reading a book about stock market analysis,” rather than the usual “Oh, I’m just looking at pics of my ex-girlfriend on Facebook.” For these reasons and more, check out my book, Beating Wall Street with Common Sense. I don’t have a degree in finance; I have a degree in neuroscience. You don’t have to predict what stocks will do if you can predict what traders will do and be one step ahead of them. I made a 400% return in the stock market over five years using only basic principles of psychology and common sense. Beating Wall Street with Common Sense is now available on Amazon, and tradingcommonsense.com is always available on your local internet!