I can't say that I'm shocked by the revision especially given where raw material prices have gone lately. The drop in 4Q EPS reflects the LCM reserve USAP will need to take for the drop in raw material pricing.

From a valuation standpoint, USAP still appears to be cheap given that it's trading well below book value which is >$21/share. If the company can remain profitable in the face of the inventory writedowns, I think the stock will eventually drift back toward book value over time.

As an aside, there are similar companies like RTI which are also trading at a significant discount to tangible book value. So there is alot of pessimism being priced into the industry.