I view X differently.
Currently (but not in the future, according to the company), US Steel is 80% self-sufficient in coke. It also owns iron ore mines. Therefore, X has an advantage in material costs over some competitors who do not have their own captive sources for raw materials. X may "operate with relatively high costs", but that imo is due to X's high labor costs.
X trades now at about 3x tangible book value (per SI financials and S&P numbers), and has had a loss year in '09.
It's certainly possible X could be a short "if things turn down from here". I can't put a probability number to it though. Nor can I put a probability number on the stock doing better if the US economy does better. In recent times though, when things were better, X stock has been up there. That is, while the stock now is @$59, 30 months ago it was up at $180.
Imo, with these price swings, this is a stock whose shorting, if any, should be left to professionals.
I've owned a few shares since 7/'09 with an occasional few share add. I'm not saying US Steel is a buy or recommending it as a buy now. I own a few shares, am aware that many if not most steel stocks have participated in the current market rally, and am betting on further upside move. |
