Olympic Steel Upgraded To Outperform At Credit Suisse

In a report published Monday, analysts at Credit Suisse upgraded

from Underperform to Outperform. The price target was raised from $12 to $17. The company is favorably leveraged to the anticipated improvement in steel prices as well as reduction of import volumes in the U.S. "Global overcapacity, depressed raw material prices and a strong US$ mean the likelihood of both these drivers recovering in tandem is low. However, even if the steel price recovery is a muted one, we are confident that a reduction in import volumes… is enough to drive this stock higher," the analysts said. Given that Olympic Steel is relies more on domestic supply, rather than on the broader market, the company is likely to gain market share when import volumes decline. In addition, the analysts expect growth in the specialty metals segment to drive improvement in the company's overall returns. "We need to see ROIC trends turn around in order to get constructive on the name longer term (3-4 years)," Credit Suisse added.