KeyBanc lowers Olympic Steel stock price target to $38 on higher opex

Investing.com - KeyBanc lowered its price target on Olympic Steel (NASDAQ:ZEUS) to $38.00 from $40.00 on Wednesday while maintaining an Overweight rating on the steel company’s stock. The company, with a market capitalization of $347 million and annual revenue of $1.87 billion, currently trades at $30.61. According to InvestingPro analysis, the stock is trading near its Fair Value.

The price target reduction follows Olympic Steel’s second-quarter 2025 results, with KeyBanc citing higher operating expenses as the primary reason for the adjustment to its 2025-2026 earnings per share and EBITDA forecasts. The company generated EBITDA of $68.26 million in the last twelve months. InvestingPro data reveals 8 additional key insights about Olympic Steel’s financial health and valuation metrics.

Despite the lowered price target, KeyBanc increased its gross profit outlook across all three of Olympic Steel’s major business segments for fiscal years 2025 and 2026.

The research firm noted that Olympic Steel maintains "ample liquidity and FCFE generation" to continue pursuing its merger and acquisition growth strategy in the coming quarters and years.

KeyBanc’s decision to maintain its Overweight rating stems from expectations of an eventual purchasing managers’ index turn and anticipated benefits from Olympic Steel’s recent automation capital expenditures.

In other recent news, Olympic Steel reported its earnings for the second quarter of 2025, exceeding expectations for earnings per share (EPS). The company posted an EPS of $0.50, surpassing the projected $0.43, marking a surprise increase of 16.28%. However, Olympic Steel faced a slight revenue shortfall, with actual revenue at $496.48 million, falling short of the forecasted $499 million. Despite this revenue miss, the company’s stock price remained stable. These developments come as part of the company’s recent financial disclosures.

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