The company faces market risk from fluctuating commodity prices (scrap metal, steel, aluminum, energy). Volatility in scrap availability and prices is a significant concern. Economic downturns, global overcapacity, and increased competition from other producers are also risks. Litigation, equipment downtime, and regulatory changes pose further challenges. Financial covenants in credit agreements could limit flexibility. Impairment charges are a potential risk.
Financial Upside
Strong demand for steel products, particularly in non-residential construction, is a positive factor. The company's diversified product portfolio and metals recycling operations offer resilience. A new aluminum mill and related facilities are under construction, with anticipated future revenue. Increased cash flow from operations and available liquidity provide funding for capital investments and dividends. Share repurchase programs are available.
