Gold prices continue to push higher, setting a new all time
high. Silver also has set a 30-year high, and precious metals
across the board seem to be lifting mining stocks. Right?
Wrong. There are a number of miners that gold prices haven't
been able to prop up, as you can see by poor earnings and recent
stock prices. What's more, many miners that also dig for
conventional metals like aluminum and copper have been brutalized
by the economic downturn. As manufacturing has slowed to a crawl,
demand for these metals has dried up too.
Here are seven metal and mining stocks investors should avoid
no matter how high gold prices go.
) is a global steel producer based in Luxembourg. This
metal stock operates in 20 countries on four continents, with 47%
of its steel produced in Europe and 35% produced in the Americas.
2010 has been very unkind to ArcelorMittal, as the stock has
dropped 28% compared to small gains by the Dow Jones Industrial
Average and S&P 500. Over the past 12 months, MT has
lost 19.1%. Trading at $32.66, MT stock is far below its
52-week high of $49.41. If you haven't already dropped this
struggling metal stock, now is the time to do so.
) is a producer of steel and steel products that operates in
three business segments: steel mills, steel products and raw
materials. This metal stock is also very active in
recycling, and reported the recycling of approximately 13.4
million tons of scrap steel in 2009. Looking past its
recycling habits, Nucor's stock has been unsavory for
shareholders as of late. Since January, NUE's stock has
seen a decline of 17.1%. The past 12 months have been even
worse Nucor, as the stock has slid 22.4% in that time.
Nucor is trading just above its 52-week low of $35.71 with a
current stock price of $38.66.
Sterlite Industries (
Another metal stock worth selling is
). Located in India, Sterlite works primarily with aluminum,
copper, zinc and lead, as well as commercial energy. Its
subsidiary deals extensively with zinc metal, cadmium, silver and
sulphuric acid. Despite its diversified "product line,"
Sterlite has seen a decline of 18% in 2010. SLT has not
fared well over the past year either, having dropped 5.1% since
last September. Having peaked in January with a stock price
of $19.91, Sterlite now trades at $14.91.
Kinross Gold (KGC
Based in Toronto,
deals primarily with gold mining. It is also involved in
the exploration and acquisition of gold-bearing properties, as
well as the extraction and processing of gold-containing
ore. While KGC stock is up slightly for 2010, or 0.8%, the
metal stock is down a dramatic 18.9% over the past 12
months. Additionally, Kinross has only exceeded earnings
estimate one out of the last four quarters. While, the
stock may be up slightly on the year, it is not far removed from
its 52-week low of $14.84 that it hit in late August.
Aluminum Corp. of China (
Based in Beijing,
Aluminum Corp. of China
) is involved with bauxite mining, alumina refining, primary
aluminum smelting and aluminum fabrication. Times have been
tough for ACH lately, as the aluminum producer has watched its
stock fade 20.6% since January and 28.6% since last
September. Things have been a nightmare for ACH since
October 2007, when the stock peaked at $79.58. Since then
the metal stock has plummeted 69.1% to its current price of
$21.65. A profit margin of -2.5% in its last financial statement
is nothing to write home about either.
) is an aluminum producer whose products are used in the
production of aircraft, automobiles, commercial transportation,
packaging, construction, defense and industrial
applications. Alcoa is based in Pittsburgh and operates in
31 countries. This metal stock dropped 30.7% in 2010,
compared with the broader markets, which are up slightly.
It's tough for shareholders to remember the last good news they
received from Alcoa, as the stock has plummeted 73.2% since
reaching a peak of over $47 in July 2007. If you haven't
dumped this stock already, do so now.
Yamana Gold (
) is a Canadian-based gold producer engaged in the exploration,
extraction, processing and reclamation of gold. Yamana operates
primarily in Brazil, Argentina, Chile and Mexico. In 2010,
this gold producer's stock dropped 4.8% compared to small gains
by the broader markets. More telling is the fact that the
stock has dropped 21.9% since the beginning of December
2009. Then, the stock was trading at $14.07.
Currently, Yamana Gold stock price is $10.83. Additionally,
AUY has missed four consecutive earnings estimates, making it a
gold stock worth selling.