Tuesday, January 12, 2010
Mother Merrill touts X to 80, upgrades the steel names and targets
And if anyone is dumping the material names because of Alcoa, which never could shoot straight--then your logic is wrong.
AA cut back so drastically because they thought they were going out of business, and then management patted themselves on the back for the recovery.
So AA had some costs that they had to absorb.
Heck, Paul O'Neil used to run Alcoa--so why would anyone use that as a proxy?
In any event, the X bulls thank you for the stock this morning!
And in credit land, the CDS on AA have tightened, leading Zero Hedge to give the erroneous conclusion that stock prices have already discounted the recovery.
Alcoa went down, because they didn't have control of costs, and CDS tightened because they paid down $700+ million of debt, and they were cash flow positive.
What is with these bears? Always seeing the shadowy, scary picture, all gussied up in intellectual gobbledygook!
Posted by Palmoni at 11:44 AM