Obviously, we are all very disappointed with this investment. Made early money from $7-$13, and sold some covered calls, but you can't get much of a call premium now, in or out of the money. Is there possibly another metals company who would see some synergy from a merger or buyout?
I am in at $10.5 the stock, and have bought and sold calls until my BE is $9.62. I disagree the premium on calls is not solid, you can still sell an October 9 for $1.06 and a Jan 09 for $1.25. I have sold both last week, and expect to walk away in January with a BE of $9, if the stock ends up at $8.99. I call that pretty conservative, and if last week flows into next and beyond, with all the gloom and doom hype meeting the rah rah hype, you can expect more rock and roll.
You can sell leaps out to 2014--do the math on the 2014 10's and 12.5's and they are rich.
You'll generate 20% cash flow to put elsewhere, instead of in and out gambling, and walk away with $11 and some pennies. It's not to the moon, but it is 10% per year, which isn't cheese.
In the meantime, all this aluminum is getting used in cars on a ritual basis and is stronger and cheaper than composite.
ACH lied about their production last year, and aluminum co's which have to use coal as fuel are folding all over the world, and that includes some of AA's shops. Grosses may be down, but the set up is for supply to come down to manageable and profitable levels. The sector is dragging AA down with it, it will remain last man standing.