Outokumpu stock rises on improved 1Q25 outlook

Published 13/02/2025, 11:18
© Reuters.

Investing.com -- Shares of Outokumpu Oyj (HEL: OUT1V) climbed 3.5% following the company’s guidance for the first quarter of 2025, which forecasts an adjusted EBITDA higher than the previous quarter despite ongoing pricing pressures and the impact of a recent strike.

The Finnish stainless steel manufacturer indicated that it expects stainless deliveries to increase by 10-20% quarter-over-quarter, potentially surpassing the mid-point consensus estimates. This optimistic delivery forecast comes after the company reported a fourth-quarter adjusted EBITDA of €-3 million, falling short of the Visible Alpha consensus of €3 million.

Despite the miss in the fourth quarter’s EBITDA, primarily due to weaker performance in its BA Europe segment, Outokumpu’s BA Americas and BA Ferrochrome segments exceeded expectations. The announced dividend of €0.26 per share matched market predictions.

The company’s net debt, reported at €189 million, was just below the consensus of €192 million. In light of the uncertain market environment, Outokumpu has shelved plans to expand its cold rolling capacity in the US, citing increased imports in recent years as a deterrent to capital-intensive investments at this moment.

Morgan Stanley (NYSE:MS) commented on the company’s prospects, stating, "We expect Outokumpu shares to perform broadly in line with the sector today."

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