Demand for steel has driven its price and prices for raw materials such metal ore and coke, and this trend will continue for some time. Shangdong province of China is building world biggest coke plant expecting to be completed in 2006 to help quench this thirst for steel and associated basic materials. Manufacturers including auto industries have log in the current price of steel expecting it to rise Feb or March this year. SIMS is in a sweet spot as a low cost producer of steel and its profit margin is excellent (gross margin 43%!). SIMS may be a run away train in the coming months and I strong doubt it will first pull back significantly. A slight pull back will be met with a lot buys as it is getting discovered day by day. Thinks about how many IBDers will jump into SIM when it passes $10 (look at recent examples such as NGPS, or past one such as CYD to see how stocks such as SIM rated top in IBD can fly)In fact, it may be a best investment this year, IMHO. I am going to margin my account to buy more of it:-)
Sit back and relax, longs. This one will do excellent for our brokage accounts.
not sure what trailing pe's have to do with anything in the market - buying on past performance won't do you much good.
i have been here since 3.50 and agree that the nice run should cause concern. however, we haven't seen any huge breakdown in the run - everyone had to expect a pullback from the huge holiday run. this stock is the most fundamentally sound in the group (if you trust ibd's stats) and should continue to perform well.
Steel sector is the cyclic ones. The high sales are earnings are due to price hike in 2004. The unit number has just increased 17%. Once the price stabalized or started to fell, which may happen sooner or later, the stock prices will fall sharply. SCHN's report has already shown inventory built up. China has asked every nation run project to slim their budget. It means to cut steel demand. These two changes (over inventory and reduced demand) will dramatically impact prices soon.
<<SIMS may be a run away train in the coming months and I strong doubt it will first pull back significantly. A slight pull back will be met with a lot buys as it is getting discovered day by day. Thinks about how many IBDers will jump into SIM when it passes $10 (look at recent examples such as NGPS, or past one such as CYD to see how stocks such as SIM rated top in IBD can fly)In fact, it may be a best investment this year, IMHO. I am going to margin my account to buy more of it:-)>>
you're comparing a steel mill to a tech company like ngps???? kind of a reach.
actually, you're pumping as if you are ready to sell and are trying to convince others to buy your shares at premium prices. watch out. china truly is slowing down. there is evidence in earnings warnings out today.
Do your own DD, ijwbhh. Everyone has to make his or her investment decisions. If you invest soly based on a message board, you need to think again:-)
For me, messge boards gave me quite a bit info. that I utilize to make my own decisions, such as DHB, COGT, ANTP etc. brought by peers I found extremly useful.
If we want to a comparison, then SIM may be more in line to TONS. Take a look it for yourself (tons was rated highly on IBD's 100 list).
If you are short, ijwbhh, beware, this thing could take off very quickly. I have seen many that highly rated by IBD took off like a roket. But if you are long and have your equity in SIM, it won't hurt you if you "pump" it in some other message boards by sharing facts. I have seen a lot that people try to scare investors to sell their shares so that they can either get their shares cheap or they shorted the stock:-)
If you have good investment ideas, please share so that some of us could benefit. This is one way our small investors will not be be "eaten" by big sharks by exchaging and looking into investments from different angles.