Harsco's Restructuring And Improving Commodity Markets Have Boosted Results

It has been a painful process, but Harsco's (HSC) share price is almost back to where it was five years ago and up sharply from sub-$4 lows two years back from today. Much better operating conditions for Harsco's steel mill customers have certainly helped, and the shares have somewhat mirrored steel producers like U.S. Steel (X) and ArcelorMittal (MT) over the last two years, but I wouldn't undersell the company's committed efforts to exit bad contracts and restructure the business for better margins.

Now Harsco is looking at a healthy (albeit probably peaking) steel sector and significant recovery growth in heat exchanger demand. The Rail business isn't doing particularly well, but that is not so surprising and remains a long-term project. Valuation is tricky, as I'll discuss later, but I believe you could make a relative valuation argument to support a higher share price from here.

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Harsco's Restructuring And Improving Commodity Markets Have Boosted Results