Tuesday, 25 March 2025

Tariffs Could Skyrocket This Steel Stock 🚀

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EDITOR'S NOTE

Tariffs are set to reshape the steel market - and history tells us that domestic producers tend to thrive under these conditions.

With the April 2 deadline quickly approaching, investors who act early could position themselves ahead of the crowd and capture significant upside potential.

Want to know the No. 1 steel stock that could benefit the most?

Join Monument Traders Alliance for a LIVE Tariff Emergency Briefing tomorrow at 2 p.m. ET.

👉 Click here to reserve your spot and discover their top 5 "Extreme Buy" stocks - including a hidden steel stock primed for explosive gains.

- Nicole Labra, Senior Managing Editor

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Steel Tariffs Are Back (And This Stock Could Skyrocket)

Karim Rahemtulla, Head Fundamental Tactician, Monument Traders Alliance

Karim Rahemtulla

Starting April 2, a 25% tariff will be imposed on imported steel from key exporters, including the European Union, Canada, and Mexico.

This move raises the cost of foreign steel - giving U.S. producers a major competitive advantage. With imports becoming more expensive, domestic steel mills are set to capture more market share as buyers shift toward cost-effective, tariff-free options.

For investors, this presents a rare opportunity to profit from a proven market shift.

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A Historical Roadmap: Lessons From the Past

This isn't the first time tariffs have upended the steel sector.

Back in March 2018, the U.S. imposed a similar 25% tariff on steel imports. The impact?

  • Domestic steel production surged. Utilization rates jumped from 70% in 2018 to 85% by 2022.
  • Steel companies posted record profits. With less foreign competition, they raised prices and expanded their margins.
  • Steel stocks outperformed the broader market. Investors who positioned themselves early saw significant gains.

With a similar tariff framework rolling out in 2025, history suggests we could see the same bullish trajectory unfold once again...

Chart - Imports of Covered Steel and Aluminum Fell Following Tariffs But Have Since Rebounded
 

Shrinking Foreign Competition

In 2024, Canada and Mexico supplied 35% of all U.S. steel imports (23% from Canada, 12% from Mexico).

With tariffs now in place, these suppliers face higher costs - forcing buyers to look toward domestic alternatives.

That shift directly benefits U.S. steel companies, allowing them to command higher prices and secure larger contracts.

Higher Margins = Bigger Profits

One of the most compelling reasons to watch U.S. steel stocks? Expanding profit margins.

Consider that during the last tariff cycle (2018-2019), hot-rolled coil margins averaged over $400 per ton.

With similar conditions unfolding today, domestic steel producers could once again raise prices - without losing demand.

Increased pricing power leads to higher earnings, stronger balance sheets, and greater investor interest.

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Policy Support and Investor Sentiment

The incoming Trump administration has made one thing clear: protecting U.S. manufacturing is a top priority.

Historically, industries that align with pro-domestic policies have seen a surge in investor confidence, leading to...

  • Higher valuations for key industry players.
  • Stronger demand as government contracts favor U.S. suppliers.
  • Sustained bullish sentiment across related sectors.

Steel companies are at the center of this trend - and investors are starting to take notice.

Supply Chain Disruptions Favor Local Producers

Tariffs don't just raise costs - they reshape entire supply chains.

Automakers, construction firms, and manufacturers - some of the largest steel buyers - will now prioritize U.S. suppliers to avoid tariff-related price spikes and delivery delays.

That means more long-term contracts for American steel companies and greater earnings stability in the years ahead.

Bottom line? With tariffs set to disrupt the steel market, U.S. producers stand to benefit from: Reduced foreign competition, higher domestic demand, expanding profit margins, a favorable political backdrop.

For investors, this is the time to take a serious look at leading U.S. steel stocks, including...

  • Nucor Corp. (NYSE: NUE): The largest and most profitable U.S. steel producer.
  • Steel Dynamics (NASDAQ: STLD): A top-tier supplier with a history of capitalizing on tariff-driven shifts.
  • U.S. Steel (NYSE: X): A legacy American steelmaker poised for increased domestic orders.

To dig deeper into these opportunities, join us for the Tariff Emergency LIVE Briefing tomorrow at 2 p.m. ET.

We'll reveal FIVE "EXTREME BUY" stocks - including one under-the-radar steel stock pick that could thrive under the new tariffs - and share the strategies we're using to turn today's volatility into profitable opportunities.

Click here to reserve your spot.

Yours in smart speculation,

Karim

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