Seven Steel Company ADRs traded in NYSE

Today the Metals Service Center Institute(MSCI) based in Illinois announced that at current shipping levels US steel inventories represent a 2.9 months supply.

The news release stated:

“Steel shipments from U.S. metals centers totaled 2.25 million tons in May, a reduction of 48.5% from May 2008 shipments. Steel shipments for the first five months of the year, at 12.3 million tons, are down 44.3% compared with last year’s period. U.S. steel inventories at metals service centers totaled 6.46 million tons at the end of May, 38.3% lower than year-ago inventories. At current shipping rates, those stocks represented a 2.9-month supply.

Canadian metals service centers shipped 375,500 tons of steel products during May, or 40.3% lower volume than a year ago. Year-to-date shipments in Canada total 2.06 million tons, down 35.6%. End-of-month stockpiles of 1.12 million tons of steel products were 30.3% lower than last year and, at current shipping rates, are equal to a 3.0-month supply.”

Worldwide commodity prices have rebounded sharply in recent weeks.Steel makers’ stocks have been hot as investors loaded up on them. However commodity prices are extremely volatile and investment in this sector is not for the faint-hearted. With that in mind, lets take a quick review of the seven steel companies that trade in the New York Stock Exchange.

1.Luxembourg-based ArcelorMittal (MT) is a global steel producer with operations in 20 countries.In 2008, total revenue was $110B. MT is a high beta stock with a beta of 2.3. The current yield is 2.29%.

2.Companhia Siderurgica Nacional(SID) is a Brazil-based company that produces carbon steel and other steel products. SID has a profit margin of 31% and last year’s revenue was $1.8B.Current dividend yield is 3.46%. From a March of low nearly $8 the stock has rebounded to close at $22.73 today.

3.Gerdau(GGB) is another Brazilian steel maker engaged in the production of long, rolled steel. Gerdau operates in 14 countries mainly in Latin America.Annual earnings growth rate is 47%.

4.Russia-based Mechel OAO(MTL) is a vertically integrated mining and steel company with factories in Russia,Romania and Lithuania. Mechel also owns and operates two trade ports, a railway and an energy company.Beta is 2.6 and the stock has fallen 83% in the last 52 weeks.

5.Posco(PKX) is one of the world’s largest steel makers based in Korea. Posco does not pay regular dividends. The annual earnings growth rate is 30%. After hitting $40 in March, the stock has more than doubled in the recent rally.

6.Tenaris (TS) is engaged in steel pipe manufacturing and distributing operations. The dividend yield is 1.79% and the beta is 1.5.

7.Argentina-based Ternium (TX) has a beta of 2.5 and a market cap of $3.4B.Average annual revenue growth rate is 20%.TX more than tripled from lows reached in March.

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