Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Usiminas Jumps as Goldman Sachs Says Buy the Stock: Rio Mover

Don't Miss Out —
Follow us on:

July 30 (Bloomberg) -- Usinas Siderurgicas de Minas Gerais SA, the Brazilian steelmaker that posted net losses in two of the past five quarters, jumped to the highest in more than a month after Goldman Sachs Group Inc. recommended buying the stock.

Preferred shares of Usiminas, as the Belo Horizonte, Brazil-based company is known, gained 5.7 percent to close at 7.01 reais in Sao Paulo, the highest since June 20. The company’s voting shares, a less traded type of stock, climbed 6 percent, leading gains in the Brazilian benchmark Bovespa index today. The preferred stock has tumbled 31 percent this year while the common stock has dropped 53 percent.

Usiminas is Goldman’s new top pick within Latin American steel stocks, analysts led by Marcelo Aguiar in Sao Paulo said in a note to customers today after upgrading their recommendation on the equity to buy from sell. The company stands to profit from a recovery in Brazil’s flat steel demand and an operational “turnaround” after the entrance of the Techint Group in the controlling shareholder group, they said.

“We expect Usiminas to outperform peers and the broader market in the next 12 months as in our view operating turnaround will begin to materialize throughout the second half of 2012,” the analysts said. “Risk/reward has become compelling for Usiminas shares.”

Techint, through its Ternium SA and Tenaris SA units, on Nov. 27 agreed to pay 5.03 billion reais for a 27.7 percent voting stake in Usiminas, teaming up with Nippon Steel Corp. to control Usiminas.

Usiminas is scheduled to report second-quarter earnings after the market closes today. The steelmaker is expected to post a net loss of 221.3 million reais excluding some items, the average of seven analysts in a Bloomberg survey.

To contact the reporter on this story: Juan Pablo Spinetto in Rio de Janeiro at jspinetto@bloomberg.net

To contact the editor responsible for this story: James Attwood at jattwood3@bloomberg.net

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.