) and Nucor (NUE
) to outperform from in-line.
Analyst Aldo Mazzaferro says U.S. Steel and Nucor now rank #1, #2, respectively, with an upside of 55% and 49%, relative to his estimated fair values . He raised U.S. Steel's and Nucor's fair values to $58 and $64, respectively, from $49 and $62, after raising normalized, 2005 earnings-per-share estimates for U.S. Steel and raising normalized, 2004 earnings-per-share estimates for Nucor.
Both companies had much better than expected third-quarter earnings per share. Mazzaferro says both companies should generate significant free cash flow in 2005.