BlueScope Steel (BSL) Stock Recommendation

BlueScope Steel (BSL) has a Reduce 2 stock recommendation and a share price target of $6.25 from stock analyst and investment banker UBS.

BlueScope hosted an analyst site visit to its Thailand and China operations last week. Key takeaways included a robust medium term outlook, partly offset by increasing domestic competition, in particular in China. Technical issues in Thailand appear corrected, the new lines in China are impressive, however, ramp up at both is to be slower than hoped, which appears in part market related. Q1 was strong for Thailand, however, the coup has had a major negative impact short term. BlueScope has secured exports to ensure mills are more fully utilised through the end of the year. China has had a good start to the year, and this looks set to continue. We believe the longer term growth story for Asia remains intact, however, we are wary of growing competition in premium products in China. Butler is also facing strong competition in the two thirds of business in lower end markets. BlueScope brands are number one, which should help underpin volumes, but with growing competitive pressures we do not see this translating into price premiums.

BlueScope Steel Limited is listed on the Australian Stock Exchange (ASX) under stock code BSL. You can view their investor website here. BSL was listed on the ASX on 15 July, 2002. Kirby Adams is the Managing Director and Graham Kraehe the Chairman for BlueScope Steel. BSL is involved in the manufacture of steel. Find out the meaning of the recommendations in this primer. Browse for other stockbroker recommendations. Check your charts and good luck with your share trading!