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Strategies & Market Trends : Value Investing

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To: Paul Senior who wrote (40717)	12/20/2010 10:08:52 AM
From: Spekulatius	of 78740

re X - interesting view. I was surprised to see that X made ~18$share in 2008. the question is if they can repeat that feat, and of course it is not sustainable to begin with. X is in fact self sufficient in terms of US iron ore but they mention that their coking facilities reach the end of the life. Besides that, coking is just a processing step for metallurgic coal and does not protect from rising coal prices. They need to pay in between 600-800M$/year into their benefit plans (health care, pensions etc.). These do not seem to run through the income statement but are a reason why so little of the earnings accrue to the shareholder. They also paid a top price in 2007 for Lone Star (tubular products). Maybe it's not a short but it sure does not look like a long either.

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