The Globe and Mail reports in its Wednesday, April 23, edition that RBC analyst James McGarragle has commenced coverage on Algoma Steel Group with a "sector perform" recommendation and an $8 share target. The Globe's David Leeder writes that analysts on average target the shares at $13. While seeing Algoma Steel's transformation to electric-arc-furnace (EAF) steel making providing "solid upside," Mr. McGarragle expects tariffs to "meaningfully weigh on near-term profitability," predicting Canadian producers be forced to sell steel to the United States at a 25-per-cent discount to U.S. benchmark prices. Accordingly, Mr. McGarrage says he will "stay on the sidelines until a more transparent trade policy emerges." However he thinks Algoma is "poised for a rerating when that situation potentially materializes and are therefore telling investors to be revisit." Mr. McGarragle says in a note: "We believe our upside scenario target multiple of seven times would be an appropriate normalized multiple for Algoma, incorporating an end to tariffs and a successful transition to EAF steel making, equating to an implied $18 valuation. However, we see tariffs and EAF execution risks as major near-term impediments to valuation."