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Sunday, December 04, 2005

Sell The Steel Stocks

Despite the takeover talks of US Steel (NYSE: X) , the fundamentals are terrible for all steel stocks. China is no longer importing steel. The input prices are increasing with higher energy costs and ore prices. Check out the following reports.
China Steel Surplus
Steel Prices Fall 23%

Note: I have no position (long or short) in any of the steel related stocks.

2 Comments:

Blogger jmcnich said...

ATVI has fallen all the wat to 13.00. We all know that eventually this stock wil go back up with realease of play station and additional x-boxes, but my question is...How much further do you think it will go down. I would love to lock in at 10.00 or 11.00 but I am not so sure that it goes that far?????

Thanks
Jerry

12/05/2005 10:38 AM  
Blogger Big Ben said...

Jerry,
I agree ATVI looks interesting at $13 down from $17. Short term, it has lost all of its "XBOX" momentum.

2006 Earnings should be $0.68. So 20 times $0.68 = $13.60. But if you give it a 15 multiple then you are looking at $10.20.

I am staying away from ATVI. But I have been wrong a lot of the time. If you follow the CANSLIM investing method you would avoid this stock because of its poor relative strength. Historically stocks that are up keep going up and stocks that are down keep going down. I can't call a short term bottom in ATVI. I wouldn't buy or short it.

12/05/2005 2:31 PM  

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