Q: I saw ASTL as a top pick on BNN by Healy a couple of weeks ago. I don't like it when stocks don't have a dividend but I do like jumping into beat up stocks in my TSFA. It has done well since I bought it.
What is your short, medium and long term outlook on this one?
What is your short, medium and long term outlook on this one?
5i Research Answer:
BRK.B has never paid a dividend but is one of the best-performing stocks over a long period. ASTL is a small-cap steel producer with a history of volatile operating results. ASTL can generate record profit in one year and turn cash flow negative the next. The company operates in a highly cyclical and competitive industry.
Over the short-term, it ccould see a bounce if the macro environment improves, such as tariffs subsiding or the Iran war de-escalating.
Over the medium and long-term, it will be a bit more reliant on economic growth in North America which continues to remain resilient but tariffs remain a bit of a shadow hanging over the company.