Why Has U.S. Steel Stock Moved 60%?
United States Steel (NYSE:X) has seen its stock increase by over 50% year to date, as compared to the 1% loss in the S&P 500 Index. U.S. Steel’s upward stock price movement is much sharper compared to that for its peers, including VALE (NYSE: VALE) which is up 8% year to date, Cleveland-Cliffs (NYSE:CLF) which is down 32% in the same period, ArcelorMittal (NYSE:MT) up 33% year to date, and Nucor Corp (NYSE: NUE) which is down 5% in the same period. U.S. Steel stock’s uptick follows President Donald Trump’s endorsement of a strategic partnership between U.S. Steel and Japan’s Nippon Steel.
The proposed $14.9 billion acquisition, initially blocked by the Biden administration due to national security concerns, is now being reframed as a “planned partnership.” Under this arrangement, U.S. Steel will maintain its headquarters in Pittsburgh, and the U.S. government will retain control over the company. Nippon Steel plans to invest up to $4 billion in a new steel mill, with the overall deal expected to create 70,000 jobs and contribute $14 billion to the U.S. economy within 14 months. For investors looking for potential gains with less volatility, the High Quality portfolio has comfortably outperformed the S&P 500, delivering over 91% returns since inception.
Factors that drove changes in U. S. Steel stock
Some of the rise of the last five months is justified by the roughly 2.5% growth seen in U. S Steel’s revenues from $3.64 billion in Q4 of 2024 to $3.73 billion in the first quarter of 2025. However, the company continued to report losses with earnings per share widening to -$0.52 in the most recent quarter compared to -$0.39 in the last quarter of 2024. See Buy or Fear X.
While U. S. Steel has seen negative revenue growth over recent years, its P/S multiple has seen an increase. The company’s P/S multiple rose from 0.4 in 2020 to 0.5 in 2024. While the company ‘s P/S is now 0.6, there is a potential downside when the current P/S is compared to levels seen in the past years: 0.3 at the end of 2021 and 0.3 as of the end of 2022.
What to expect from U.S. Steel stock
U.S. Steel’s recent financial performance reflects ongoing challenges in the steel industry, marked by declining earnings and revenue. Revenue came in $3.73 billion in the first quarter of 2025, down 10.4% year-over-year. Adjusted EBITDA was reported at $172 million, reflecting a decrease from $190 million in Q4 2024. Adjusted EBITDA in the Flat-Rolled segment was $104 million, down 33% year-over-year due to lower average realized prices and higher energy costs. The company anticipates adjusted EBITDA for Q2 2025 to range between $375 million and $425 million, expecting improvements in the North American Flat-Rolled and Mini Mill segments as seasonal logistics constraints ease and steel prices rise.
President Donald Trump’s endorsement of Nippon’s acquisition of U. S. Steel has been well-received by investors, as it not only resolves previous uncertainties but also positions U.S. Steel to become part of the world’s third-largest steel producer by volume. The stock’s rise reflects optimism about the company’s future under this new partnership. See our analysis on U. S. Steel’s Valuation: Is X Stock Expensive Or Cheap? for more information on what’s driving our valuation for U. S. Steel.
Regulatory risk is just a small part of the risk assessment framework we apply while constructing the Trefis High Quality (HQ) Portfolio which, with a collection of 30 stocks, has a track record of comfortably outperforming the S&P 500 over the last 4-year period. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride as evident in HQ Portfolio performance metrics.
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