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The steel (general) industry is expected to struggle in 1999, although prospects for the industry may improve in 2000. Companies in this sector of the steel industry exhibit strong fundamentals, but the lack of profitability, despite a continuing economic expansion, will hurt performance. However, the long-term prospects for this industry remain solid.

The steel (general) industry, which is comprised of a wide variety of companies that produce carbon steel from many sources, has not been sharing in the good US economy of the late 1990s. Steel prices are falling and demand has also plateaued, but this could change with better economic conditions overseas. Investors will not find these stocks to be timely in 1999.

The nonintegrated steel industry outperformed the market in 1994, thanks to a resurgent US economy. This group, consisting of companies that manufacture carbon steel from scrap in electric arc furnaces, plus other carbon steel and specialty makers, has proved financially stable, even in downturns. It enjoys low labor costs, modern facilities and healthy geographic expansion. Still, investors should stick with Nucor and other proven companies.

The prospects for steel industry stocks are evaluated. The industry has made an impressive comeback, and its recovery should continue through 1995, if the economy's slowdown is held in check. The nonintegrated steel sector's structural and cyclical underpinnings appear to be sound, and its long-term prospects are bright. Evaluations of individual stocks are included.

The nonintegrated steel industry is exhibiting a strong forward momentum, though over the long term, growth could slow. Companies in this industry, which use electric arc furnaces to produce carbon steel from scrap, have improved their fundamentals. Shipment volume continues to grow higher, with estimates of 90 million tons of steel being projected for all of 1994. Investors in this market should not expect to see declining prospects until after 1996.

The non-integrated steel industry is recovering along with the recovering US economy. It should post higher earnings gains than average for other industries in 1994 and 1995. Commercial Metals, Worthington Industries, Carpenter Technology and Nucor are among the companies with higher than average price stability ratings, but should be considered by long-term investors.

The general steel industry, consisting mostly of companies which produce carbon steel from scrap in furnaces, is improving along with the general economy, and should be considered by investors looking for long-term prospects rather than immediate growth. Demand for automobiles, appliances, furniture and houses is up uniformly, allowing steel companies to gradually improve their order times and shipping processes as well as upgrade some of their plants. Growth should approach 3-3.5% in 1994, a slight drop from 4th qtr 1993.

Birmingham Steel has declared itself bankrupt and under pre-agreed terms expects to be purchased by Nucor Corp. for $615 million. By structuring its takeover through a Chapter 11 reorganization, Nucor [...]