NEW YORK—Moody's Investors Service said Monday that it placed the ratings of AK Steel Corp. under review for a possible upgrade.
Moody's said the review is based on AK Steel's improved operating and financial profile driven by strong steel fundamentals and the company's reduction in debt and pension liabilities.
Moody's currently has a corporate family rating of "Ba3" on AK Steel. The review covers approximately $550 million of debt.
Moody's said the review will focus on the sustainable level of earnings and cash flow generation in a more normalized steel price environment along with the company's cost position in light of raw material and energy cost challenges.
Moody's also will look at AK Steel's product mix and end market exposures, particularly the automotive and appliance sectors, which are experiencing softness due to economic weakness in the U.S. The review also will focus on the electrical steel market where the company enjoys a solid position and where there is more limited downside risk due to strength in the power generation markets, Moody's said.
Shares of Middletown, Ohio-based AK Steel rose $1.62, or 3.3 percent, to close at $50.32.
