Intrinsic value of United States Steel - X

Previous Close

$39.31

  Intrinsic Value

$3.20

stock screener

  Rating & Target

str. sell

-92%

Previous close

$39.31

 
Intrinsic value

$3.20

 
Up/down potential

-92%

 
Rating

str. sell

*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of X stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Shares outstanding, mln

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  -11.34
  20.90
  19.31
  17.88
  16.59
  15.43
  14.39
  13.45
  12.60
  11.84
  11.16
  10.54
  9.99
  9.49
  9.04
  8.64
  8.27
  7.95
  7.65
  7.39
  7.15
  6.93
  6.74
  6.57
  6.41
  6.27
  6.14
  6.03
  5.92
  5.83
  5.75
Revenue, $m
  10,261
  12,406
  14,801
  17,447
  20,342
  23,481
  26,860
  30,473
  34,314
  38,378
  42,661
  47,159
  51,870
  56,793
  61,928
  67,277
  72,843
  78,631
  84,648
  90,900
  97,398
  104,150
  111,170
  118,469
  126,062
  133,964
  142,191
  150,761
  159,693
  169,007
  178,723
Variable operating expenses, $m
 
  13,733
  16,385
  19,314
  22,519
  25,994
  29,734
  33,733
  37,985
  42,484
  47,225
  52,205
  57,420
  62,869
  68,554
  74,475
  80,637
  87,045
  93,705
  100,627
  107,819
  115,294
  123,065
  131,145
  139,550
  148,298
  157,406
  166,893
  176,781
  187,091
  197,846
Fixed operating expenses, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  10,448
  13,733
  16,385
  19,314
  22,519
  25,994
  29,734
  33,733
  37,985
  42,484
  47,225
  52,205
  57,420
  62,869
  68,554
  74,475
  80,637
  87,045
  93,705
  100,627
  107,819
  115,294
  123,065
  131,145
  139,550
  148,298
  157,406
  166,893
  176,781
  187,091
  197,846
Operating income, $m
  -187
  -1,327
  -1,584
  -1,867
  -2,177
  -2,512
  -2,874
  -3,261
  -3,672
  -4,106
  -4,565
  -5,046
  -5,550
  -6,077
  -6,626
  -7,199
  -7,794
  -8,414
  -9,057
  -9,726
  -10,422
  -11,144
  -11,895
  -12,676
  -13,489
  -14,334
  -15,214
  -16,131
  -17,087
  -18,084
  -19,123
EBITDA, $m
  320
  -711
  -849
  -1,001
  -1,167
  -1,347
  -1,540
  -1,748
  -1,968
  -2,201
  -2,447
  -2,705
  -2,975
  -3,257
  -3,551
  -3,858
  -4,177
  -4,509
  -4,854
  -5,213
  -5,586
  -5,973
  -6,375
  -6,794
  -7,230
  -7,683
  -8,154
  -8,646
  -9,158
  -9,692
  -10,250
Interest expense (income), $m
  193
  188
  278
  378
  489
  611
  743
  884
  1,036
  1,197
  1,368
  1,548
  1,736
  1,934
  2,141
  2,356
  2,581
  2,814
  3,057
  3,310
  3,572
  3,845
  4,128
  4,423
  4,729
  5,048
  5,379
  5,725
  6,084
  6,459
  6,850
Earnings before tax, $m
  -416
  -1,515
  -1,861
  -2,245
  -2,666
  -3,123
  -3,617
  -4,145
  -4,708
  -5,304
  -5,933
  -6,594
  -7,286
  -8,011
  -8,767
  -9,555
  -10,375
  -11,228
  -12,114
  -13,036
  -13,994
  -14,989
  -16,023
  -17,099
  -18,218
  -19,382
  -20,594
  -21,856
  -23,172
  -24,543
  -25,973
Tax expense, $m
  24
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  -440
  -1,515
  -1,861
  -2,245
  -2,666
  -3,123
  -3,617
  -4,145
  -4,708
  -5,304
  -5,933
  -6,594
  -7,286
  -8,011
  -8,767
  -9,555
  -10,375
  -11,228
  -12,114
  -13,036
  -13,994
  -14,989
  -16,023
  -17,099
  -18,218
  -19,382
  -20,594
  -21,856
  -23,172
  -24,543
  -25,973

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  1,515
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  9,160
  9,244
  11,029
  13,001
  15,158
  17,497
  20,015
  22,707
  25,569
  28,597
  31,789
  35,141
  38,651
  42,319
  46,146
  50,132
  54,279
  58,592
  63,076
  67,735
  72,576
  77,608
  82,839
  88,278
  93,936
  99,824
  105,955
  112,341
  118,997
  125,937
  133,177
Adjusted assets (=assets-cash), $m
  7,645
  9,244
  11,029
  13,001
  15,158
  17,497
  20,015
  22,707
  25,569
  28,597
  31,789
  35,141
  38,651
  42,319
  46,146
  50,132
  54,279
  58,592
  63,076
  67,735
  72,576
  77,608
  82,839
  88,278
  93,936
  99,824
  105,955
  112,341
  118,997
  125,937
  133,177
Revenue / Adjusted assets
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
  1.342
Average production assets, $m
  4,381
  5,297
  6,320
  7,450
  8,686
  10,026
  11,469
  13,012
  14,652
  16,387
  18,216
  20,137
  22,148
  24,250
  26,443
  28,727
  31,104
  33,575
  36,145
  38,814
  41,589
  44,472
  47,469
  50,586
  53,828
  57,203
  60,716
  64,375
  68,189
  72,166
  76,315
Working capital, $m
  2,025
  682
  814
  960
  1,119
  1,291
  1,477
  1,676
  1,887
  2,111
  2,346
  2,594
  2,853
  3,124
  3,406
  3,700
  4,006
  4,325
  4,656
  5,000
  5,357
  5,728
  6,114
  6,516
  6,933
  7,368
  7,821
  8,292
  8,783
  9,295
  9,830
Total debt, $m
  3,031
  4,409
  6,005
  7,768
  9,696
  11,787
  14,038
  16,445
  19,004
  21,711
  24,564
  27,561
  30,699
  33,979
  37,399
  40,963
  44,671
  48,527
  52,535
  56,700
  61,028
  65,527
  70,203
  75,065
  80,124
  85,388
  90,868
  96,578
  102,528
  108,732
  115,205
Total liabilities, $m
  6,886
  8,264
  9,860
  11,623
  13,551
  15,642
  17,893
  20,300
  22,859
  25,566
  28,419
  31,416
  34,554
  37,834
  41,254
  44,818
  48,526
  52,382
  56,390
  60,555
  64,883
  69,382
  74,058
  78,920
  83,979
  89,243
  94,723
  100,433
  106,383
  112,587
  119,060
Total equity, $m
  2,274
  980
  1,169
  1,378
  1,607
  1,855
  2,122
  2,407
  2,710
  3,031
  3,370
  3,725
  4,097
  4,486
  4,891
  5,314
  5,754
  6,211
  6,686
  7,180
  7,693
  8,226
  8,781
  9,357
  9,957
  10,581
  11,231
  11,908
  12,614
  13,349
  14,117
Total liabilities and equity, $m
  9,160
  9,244
  11,029
  13,001
  15,158
  17,497
  20,015
  22,707
  25,569
  28,597
  31,789
  35,141
  38,651
  42,320
  46,145
  50,132
  54,280
  58,593
  63,076
  67,735
  72,576
  77,608
  82,839
  88,277
  93,936
  99,824
  105,954
  112,341
  118,997
  125,936
  133,177
Debt-to-equity ratio
  1.333
  4.500
  5.140
  5.640
  6.030
  6.360
  6.620
  6.830
  7.010
  7.160
  7.290
  7.400
  7.490
  7.570
  7.650
  7.710
  7.760
  7.810
  7.860
  7.900
  7.930
  7.970
  7.990
  8.020
  8.050
  8.070
  8.090
  8.110
  8.130
  8.150
  8.160
Adjusted equity ratio
  0.099
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106
  0.106

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -440
  -1,515
  -1,861
  -2,245
  -2,666
  -3,123
  -3,617
  -4,145
  -4,708
  -5,304
  -5,933
  -6,594
  -7,286
  -8,011
  -8,767
  -9,555
  -10,375
  -11,228
  -12,114
  -13,036
  -13,994
  -14,989
  -16,023
  -17,099
  -18,218
  -19,382
  -20,594
  -21,856
  -23,172
  -24,543
  -25,973
Depreciation, amort., depletion, $m
  507
  616
  735
  866
  1,010
  1,166
  1,334
  1,513
  1,704
  1,906
  2,118
  2,341
  2,575
  2,820
  3,075
  3,340
  3,617
  3,904
  4,203
  4,513
  4,836
  5,171
  5,520
  5,882
  6,259
  6,651
  7,060
  7,485
  7,929
  8,391
  8,874
Funds from operations, $m
  1,366
  -899
  -1,127
  -1,379
  -1,656
  -1,957
  -2,283
  -2,632
  -3,004
  -3,398
  -3,814
  -4,252
  -4,711
  -5,191
  -5,692
  -6,214
  -6,758
  -7,324
  -7,912
  -8,523
  -9,158
  -9,818
  -10,504
  -11,217
  -11,959
  -12,730
  -13,534
  -14,371
  -15,243
  -16,152
  -17,100
Change in working capital, $m
  639
  118
  132
  146
  159
  173
  186
  199
  211
  224
  236
  247
  259
  271
  282
  294
  306
  318
  331
  344
  357
  371
  386
  401
  418
  435
  453
  471
  491
  512
  534
Cash from operations, $m
  727
  -1,017
  -1,258
  -1,524
  -1,815
  -2,130
  -2,469
  -2,831
  -3,215
  -3,622
  -4,050
  -4,499
  -4,970
  -5,462
  -5,975
  -6,509
  -7,064
  -7,642
  -8,243
  -8,867
  -9,515
  -10,189
  -10,890
  -11,618
  -12,376
  -13,165
  -13,986
  -14,842
  -15,734
  -16,664
  -17,634
Maintenance CAPEX, $m
  0
  -509
  -616
  -735
  -866
  -1,010
  -1,166
  -1,334
  -1,513
  -1,704
  -1,906
  -2,118
  -2,341
  -2,575
  -2,820
  -3,075
  -3,340
  -3,617
  -3,904
  -4,203
  -4,513
  -4,836
  -5,171
  -5,520
  -5,882
  -6,259
  -6,651
  -7,060
  -7,485
  -7,929
  -8,391
New CAPEX, $m
  -306
  -917
  -1,023
  -1,130
  -1,236
  -1,340
  -1,443
  -1,543
  -1,640
  -1,735
  -1,829
  -1,921
  -2,012
  -2,102
  -2,193
  -2,284
  -2,377
  -2,472
  -2,569
  -2,670
  -2,774
  -2,883
  -2,997
  -3,117
  -3,242
  -3,374
  -3,513
  -3,660
  -3,814
  -3,977
  -4,149
Cash from investing activities, $m
  -318
  -1,426
  -1,639
  -1,865
  -2,102
  -2,350
  -2,609
  -2,877
  -3,153
  -3,439
  -3,735
  -4,039
  -4,353
  -4,677
  -5,013
  -5,359
  -5,717
  -6,089
  -6,473
  -6,873
  -7,287
  -7,719
  -8,168
  -8,637
  -9,124
  -9,633
  -10,164
  -10,720
  -11,299
  -11,906
  -12,540
Free cash flow, $m
  409
  -2,443
  -2,897
  -3,389
  -3,917
  -4,481
  -5,077
  -5,707
  -6,368
  -7,061
  -7,784
  -8,538
  -9,323
  -10,139
  -10,987
  -11,867
  -12,781
  -13,730
  -14,716
  -15,739
  -16,803
  -17,908
  -19,058
  -20,255
  -21,501
  -22,798
  -24,151
  -25,562
  -27,033
  -28,570
  -30,174
Issuance/(repayment) of debt, $m
  -112
  1,428
  1,596
  1,763
  1,928
  2,091
  2,251
  2,407
  2,559
  2,707
  2,853
  2,997
  3,138
  3,279
  3,421
  3,563
  3,708
  3,856
  4,008
  4,165
  4,328
  4,498
  4,676
  4,862
  5,058
  5,264
  5,481
  5,709
  5,950
  6,204
  6,473
Issuance/(repurchase) of shares, $m
  517
  1,686
  2,051
  2,454
  2,895
  3,371
  3,883
  4,430
  5,011
  5,625
  6,271
  6,949
  7,659
  8,400
  9,172
  9,977
  10,814
  11,685
  12,590
  13,530
  14,507
  15,522
  16,578
  17,675
  18,817
  20,006
  21,244
  22,533
  23,877
  25,279
  26,741
Cash from financing (excl. dividends), $m  
  390
  3,114
  3,647
  4,217
  4,823
  5,462
  6,134
  6,837
  7,570
  8,332
  9,124
  9,946
  10,797
  11,679
  12,593
  13,540
  14,522
  15,541
  16,598
  17,695
  18,835
  20,020
  21,254
  22,537
  23,875
  25,270
  26,725
  28,242
  29,827
  31,483
  33,214
Total cash flow (excl. dividends), $m
  791
  671
  749
  828
  905
  982
  1,057
  1,130
  1,202
  1,271
  1,340
  1,407
  1,474
  1,540
  1,606
  1,673
  1,741
  1,811
  1,882
  1,956
  2,032
  2,112
  2,196
  2,283
  2,375
  2,472
  2,574
  2,681
  2,794
  2,913
  3,039
Retained Cash Flow (-), $m
  162
  -1,686
  -2,051
  -2,454
  -2,895
  -3,371
  -3,883
  -4,430
  -5,011
  -5,625
  -6,271
  -6,949
  -7,659
  -8,400
  -9,172
  -9,977
  -10,814
  -11,685
  -12,590
  -13,530
  -14,507
  -15,522
  -16,578
  -17,675
  -18,817
  -20,006
  -21,244
  -22,533
  -23,877
  -25,279
  -26,741
Prev. year cash balance distribution, $m
 
  1,465
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  450
  -1,301
  -1,626
  -1,989
  -2,389
  -2,827
  -3,300
  -3,809
  -4,353
  -4,931
  -5,542
  -6,185
  -6,860
  -7,566
  -8,304
  -9,073
  -9,874
  -10,708
  -11,574
  -12,474
  -13,410
  -14,382
  -15,392
  -16,442
  -17,534
  -18,670
  -19,852
  -21,083
  -22,365
  -23,702
Discount rate, %
 
  7.40
  7.77
  8.16
  8.57
  8.99
  9.44
  9.92
  10.41
  10.93
  11.48
  12.05
  12.66
  13.29
  13.95
  14.65
  15.38
  16.15
  16.96
  17.81
  18.70
  19.63
  20.62
  21.65
  22.73
  23.87
  25.06
  26.31
  27.63
  29.01
  30.46
PV of cash for distribution, $m
 
  419
  -1,120
  -1,285
  -1,432
  -1,553
  -1,645
  -1,703
  -1,725
  -1,711
  -1,663
  -1,585
  -1,480
  -1,355
  -1,215
  -1,068
  -919
  -774
  -638
  -514
  -405
  -311
  -233
  -170
  -121
  -83
  -56
  -36
  -23
  -14
  -8
Current shareholders' claim on cash, %
  100
  59.6
  35.4
  21.0
  12.5
  7.4
  4.4
  2.6
  1.6
  0.9
  0.6
  0.3
  0.2
  0.1
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

United States Steel Corporation is an integrated steel producer. The Company is engaged in producing flat-rolled and tubular products with production operations in North America and Europe. The Company operates through three segments: Flat-Rolled Products (Flat-Rolled), U. S. Steel Europe (USSE) and Tubular Products (Tubular). The Flat-Rolled segment includes the operating results of its integrated steel plants and equity investees in the United States involved in the production of slabs, rounds, strip mill plates, sheets and tin mill products, as well as all iron ore and coke production facilities in the United States. The USSE segment includes the operating results of U. S. Steel Kosice (USSK) and its integrated steel plant and coke production facilities in Slovakia. The Tubular segment includes the operating results of its tubular production facilities, primarily in the United States and equity investees in the United States and Brazil.

FINANCIAL RATIOS  of  United States Steel (X)

Valuation Ratios
P/E Ratio -15.5
Price to Sales 0.7
Price to Book 3
Price to Tangible Book
Price to Cash Flow 9.4
Price to Free Cash Flow 16.2
Growth Rates
Sales Growth Rate -11.3%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -38.8%
Cap. Spend. - 3 Yr. Gr. Rate -8.6%
Financial Strength
Quick Ratio 30
Current Ratio 0
LT Debt to Equity 131.1%
Total Debt to Equity 133.3%
Interest Coverage -1
Management Effectiveness
Return On Assets -2.6%
Ret/ On Assets - 3 Yr. Avg. -4.6%
Return On Total Capital -8.1%
Ret/ On T. Cap. - 3 Yr. Avg. -10.7%
Return On Equity -18.7%
Return On Equity - 3 Yr. Avg. -22.8%
Asset Turnover 1.1
Profitability Ratios
Gross Margin 6.2%
Gross Margin - 3 Yr. Avg. 7.2%
EBITDA Margin 2.8%
EBITDA Margin - 3 Yr. Avg. 0.9%
Operating Margin -1.8%
Oper. Margin - 3 Yr. Avg. -3.4%
Pre-Tax Margin -4.1%
Pre-Tax Margin - 3 Yr. Avg. -5.2%
Net Profit Margin -4.3%
Net Profit Margin - 3 Yr. Avg. -6%
Effective Tax Rate -5.8%
Eff/ Tax Rate - 3 Yr. Avg. 7.2%
Payout Ratio -7%

X stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the X stock intrinsic value calculation we used $10261 million for the last fiscal year's total revenue generated by United States Steel. The default revenue input number comes from 2016 income statement of United States Steel. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our X stock valuation model: a) initial revenue growth rate of 20.9% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 7.4%, whose default value for X is calculated based on our internal credit rating of United States Steel, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of United States Steel.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of X stock the variable cost ratio is equal to 110.7%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for X stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 6.3% for United States Steel.

Corporate tax rate of 27% is the nominal tax rate for United States Steel. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the X stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for X are equal to 42.7%.

Life of production assets of 8.6 years is the average useful life of capital assets used in United States Steel operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for X is equal to 5.5%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $2274 million for United States Steel - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 177.607 million for United States Steel is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of United States Steel at the current share price and the inputted number of shares is $7.0 billion.

RELATED COMPANIES Price Int.Val. Rating
CLF Cleveland-Clif 8.49 5.74  sell
MT ArcelorMittal 36.68 6.07  str.sell
WOR Worthington In 48.03 371.93  str.buy
STLD Steel Dynamics 46.78 2.63  str.sell
PKX POSCO ADR 89.66 25.41  str.sell
RS Reliance Steel 90.97 9.21  str.sell
AP Ampco-Pittsbur 14.60 16.84  buy

COMPANY NEWS

▶ Nucor: What Analysts Expect This Earnings Season   [Jan-18-18 02:55PM  Market Realist]
▶ Chicago group sues US Steel over Indiana plant's discharges   [Jan-17-18 07:54PM  Associated Press]
▶ What to Expect from Cleveland-Cliffs 4Q17 US Volumes   [Jan-16-18 05:10PM  Market Realist]
▶ What Could Drive US Steel Prices this Year?   [10:31AM  Market Realist]
▶ Will 2018 Mean Déjà Vu for US Steelmakers?   [09:01AM  Market Realist]
▶ Have US Steel Stocks Front-Loaded Their 2018 Gains?   [Jan-15-18 04:55PM  Market Realist]
▶ Steel industry wants fast action now that probe on imports concluded   [Jan-12-18 03:10PM  American City Business Journals]
▶ Higher Chinese Exports Could Spoil Steel Companies Party   [Jan-11-18 10:31AM  Market Realist]
▶ US Steel Demand: 2018 Could Be a Strong Year   [07:32AM  Market Realist]
▶ President Trump Could Still Save US Steel   [Jan-10-18 10:33AM  Market Realist]
▶ What Could Drive US Steel Companies 2018 Performance?   [Jan-09-18 04:25PM  Market Realist]
▶ Why AK Steel Holdings Stock Plummeted 45% in 2017   [Jan-08-18 04:02PM  Motley Fool]
▶ How Steel Companies PE Ratios Stack Up   [07:34AM  Market Realist]
▶ Does U.S. Steel Look Undervalued in 2018?   [Jan-02-18 06:00PM  Market Realist]
▶ Wait For Pullback to Buy Red-Hot Metals   [01:53PM  Investopedia]
▶ Top 4 Steel Stocks for 2018   [06:00AM  Investopedia]
▶ How Markets Are Valuing US Steel Stocks Heading into 2018   [Jan-01-18 10:31AM  Market Realist]
▶ [$$] Review: The Unlikely Trust of Teddy Roosevelt and J.P. Morgan   [Dec-29-17 11:33PM  The Wall Street Journal]
▶ Steel Dynamics Stock Breaks Out to All-Time High   [Dec-27-17 09:50AM  Investopedia]
▶ What Challenges U.S. Steel Corporation Could Face in 2018   [Dec-26-17 07:31AM  Market Realist]
▶ U.S. Steel Corporation: What Will Be Santas Best Gift?   [Dec-22-17 01:20PM  Market Realist]
▶ Top sectors to watch in 2018   [Dec-20-17 01:39PM  CNBC Videos]
▶ Section 232: US Steel Companies Trump Card in 2018   [Dec-19-17 07:32AM  Market Realist]
▶ Markets May Party All the Way Into 2018   [07:20AM  InvestorPlace]
▶ Stocks To Watch: United States Steel Sees RS Rating Rise To 81   [03:00AM  Investor's Business Daily]
▶ Steel Industry Stock Outlook - December 2017   [Dec-15-17 01:31PM  Zacks]
▶ Are U.S. Steel Corporation Bears on the Verge of Extension?   [Dec-14-17 04:10PM  Market Realist]
▶ Steelmaker Blames Profit Warning On Rising Imports Under Trump   [04:01PM  Investor's Business Daily]
▶ How Nucor Views Trumps Infrastructure Plans   [12:29PM  Market Realist]
▶ Is Nucor Corporation a Buy?   [06:02AM  Motley Fool]
▶ Records: US Steel failed to test for toxic metal after spill   [Dec-13-17 06:03PM  Associated Press]
▶ Vietnam Trade Case: Why US Steelmakers Are Optimistic   [Dec-12-17 10:32AM  Market Realist]
▶ An Early Christmas for Steel Stocks   [09:03AM  Market Realist]
▶ United States Steel Earns RS Rating Upgrade   [03:00AM  Investor's Business Daily]
Financial statements of X
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