Steel rebounds

There is no way for the economy to rebound if steel stocks don't rebound. Here are three steel stocks that analysts expect to increase earnings by over 100% this year.

By Jim Van Meerten Feb 7, 2011 3:29PM

If the economy is to recover, steel is not an optional industry.


It's an essential industry right in the core of the auto, infrastructure and manufacturing industries. It's hard to think of an industry that does not use steel or metal products somewhere. 


Luckily, this industry has shown signs of recovery. 


Just look at the chart of the steel industry index price change vs, the 20, 50 and 100 day moving averages and Trend Spotter in the last 2 1/2 months:


 

Charts provided with permission from Barchart.com.
 
The steel industry has enjoyed very good price appreciation recently so I used Barchart to begin my search for stocks showing the most consistent price momentum, prospects for earnings growth and positive investor sentiment.  Take a look at these 3 and maybe add them to your watch lists.

Allegheny Technologies (ATI) -- produces specialty materials including stainless steel, nickel-based and cobalt-based alloys and superalloys, titanium and titanium alloys.
 

  • 96% Barchart.com technical buy signal
  • Trend Spotter (tm) buy signal
  • 6 new highs and up 21.95% in the last month
  • Relative Strength Index 71.21% and rising
  • Trades around 67.64 with a 50 day moving average of 57.63
  • Wall Street brokerages have published 7 buy and 2 hold recommendation
  • Sales are projected to increase 17.50% this year and 8.40% next year
  • Earnings are estimated to increase by 269.50% this year, 40.60% next year and continue at 20.00% annually for the next 5 years
  • Investor sentiment is very high with the CAPS members on Motley Foll voting 1064 to 61 that the stock will beat the market with the All Stars in agreement 389 to 10
Haynes International -- manufacturer of high-performance nickel- and cobalt-based alloys for service in severe corrosion and high-temperature applications.
 


  • 96% Barchart.com technical buy signal
  • Trend Spotter (tm) buy signal
  • 12 new highs and up 21.75% in the last month
  • Relative Strength Index 67.60%
  • Trades around 50.12 with a 50 day moving average of 43.12
  • Wall Street brokerages have 4 buy and 2 hold recommendations published
  • Sales are projected to increase by 15.80% this year and 8.40% next year
  • Earnings are estimated to increase by 211.00% this year,21.10% next year and 18.00 annually for the next 5 years
  • Investor sentiment is high with the CAPS members on Motley Fool voting 211 to 13 that the stock will beat the market and the All Stars agere 84 to 1
Steel Dynamics-- owns and operates a flat-rolled steel mini-mills.
 

  • 88% Barchart.com technical buy signal
  • Trend Spotter (tm) buy signal
  • 4 new highs and up 4.89% in the last week
  • Relative Strength Index 60.85% and rising
  • Trades around 19.06 with a 50 day moving average of 17.86
  • Wall Street brokerages have 9 buy and 2 hold recommendations published
  • Sales are projected to increase by 25.30% this year and 6.30% next year
  • Earnings are estimated to increase by 143.30% this year, 33.10% next year and 31.90% annually for the next 5 years
  • Investor sentiment is positive with the CAPS members on Motley Fool voting 945 to 35 that the stock will beat the market and the All Stars agree by a vote of 297 to 6.
There you go - 3 steel stocks that are expected to increase earing per share by over 100% this year.  Add these to your watch lists.

Jim Van Meerten is a professional investor with over 40 year experience in investing in stocks, mutual funds and ETFs.  He shares his knowledge on Barchart in his daily blogs -- Barchart Portfolio Blogs.

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