RBC Capital Downgrades GrafTech - Read Why - GrafTech International (NYSE:EAF)

RBC Capital analyst Arun Viswanathan downgraded GrafTech International Ltd EAF to Sector Perform from Outperform and lowered the price target to $7 (an upside of 9%) from $10.
The analyst states that the downgrade reflects cost/demand headwinds and lower average realized price for LTAs in the ~$7K range (from ~$9K).
Viswanathan mentions that given the current macro enlivenment and HRC steel prices, he sees no need for EAF's customers to lock in LTAs and/ or to lock in LTAs at prices significantly above current spot levels.
The analyst expects demand to wane for electrodes and electric arc furnace steel.
He also sees macro headwinds diminishing electrode demand and the elevated risk of a recession, especially in Europe, which should result in a cyclical downturn in construction and the need for steel.
Price Action: EAF shares are trading lower by 5.52% at $6.41 on the last check Wednesday.