The investment analysis
company, Dahlman Rose & Co., has raised its rating on AK Steel Holding
Corporation(NYSE:AKS)’s stock to ‘Hold’ from ‘Sell’. The change comes after AK
Steel’s stock price went up sometime in mid-November. The shares lost 1/3rd
of their worth in 4 days through 15th November after the steel
manufacturer based in West Chester said that it would take a huge fourth
quarter loss owing to poor steel prices and an income tax charge.
In addition, James
Wainscott, the CEO has purchased 100,000 shares on Tuesday in lieu of $384,500.
That comes after stock purchases by 3 AK Steel insiders over a period of two
trading days after Thanksgiving Day. Analysts frequently see insider buying as optimistic
for the stock.
It definitely seems the
case now. Between Wainscott’s purchase and the upgrade, AK Steel’s shares
rallied 21 cents to $4 in mid-afternoon trading on Wednesday.
The directors of a
company often have the tendency of having a distinctive inside view into the
business, so when directors make big purchases, investors are wise to notice
that. Perhaps, the sole reason for a director of a company to opt for using
their hard-earned cash to purchase stock in the open market is that they expect
to make profit.
Average cost of
Wainscott works out to $3.85 per share. On Wednesday, bargain hunters could
purchase shares of AK Steel and get a cost basis lower than Wainscott with
shares changing hands as $3.82 for each share.
AK Steel Holding Corp.
has completed securities offerings of %588 million before underwriting fees and
other associated expenses.
The offerings take into
account $350 million of 8.750% senior held notes due 2018 and $150 million of
5% exchangeable senior notes due 2019.
Wainscott has stated
that these offering are a part of the company’s strategy at AK Steel to bolster
the company and increasing value for its investors.
Shares of AKS have
jumped 16% in the past one week, but still down 50% so far this year.
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