Sims Metal Management Limited (NYSE:SMS)

falcon2382 (31.19) Submitted: 4/28/2008 1:23:00 PM : Start Price: $29.45 SMS Score: -61.16

Sims Group Limited is a metal recycling company with grobal reaches. Its headquarters is in Sydney but it also operates a great deal in the US and the UK. Sims also has a network of trading offices in Asia. Sims Group operates two primary businesses: Metal Recycling and Sims Recycling Solutions. The Metal Recycling business involves the collection, processing and marketing of ferrous and non-ferrous metals. The Sims Recycling Solutions business involves the e-recycling of information technology equipment and electrical and electronic consumer goods, and has operations in the United Kingdom, Continental Europe and North America and a presence in the Asia Pacific region. On March 14, 2008, the Company completed merger with Metal Management, Inc., which is one of the service metal recyclers in the United States, with 53 recycling facilities in 17 states. In April 2008, the Company completed the acquisition of Life Cycle Services, based in the United Kingdom.

With Green/clean energy solutions becoming a main focus of many developed and developing countries, the increased cost of steel and other metals, the exceedingly high cost of oil (with no REAL end in sight) and in turn the higher cost of producing paper and metals from raw materials, the recycling industry seems poised for tremendous growth over the next five years. This is a long term play since the stock is hardly followed, but also a momentum play in terms of the sector growth in the aforementioned areas of the market from which Recycling benefits.

etfman (53.31) Submitted: 4/24/2008 9:49:34 PM : Start Price: $28.66 SMS Score: -60.55

Demand for metal is accelerating because of the growth in developing countries. This business will be endless.

strngedaz (< 20) Submitted: 4/24/2008 9:28:10 AM : Start Price: $28.96 SMS Score: -62.63

I'm all for municipal recycling contracts. More people are recycling. Which can only mean more contracts

wordhunter (< 20) Submitted: 4/22/2008 11:37:56 AM : Start Price: $29.32 SMS Score: -62.47

Steel is good.

CliffHucker (65.54) Submitted: 4/21/2008 6:33:17 PM : Start Price: $29.32 SMS Score: -62.27

Because I am the Man of Steel...

LouGaru (< 20) Submitted: 4/20/2008 7:25:41 PM : Start Price: $28.75 SMS Score: -61.45

I work for the New York City Dept. of Sanitation. Sims recycles all the metal, plastic and glass in the entire city. That's a heck of a contract.

lalakskss (< 20) Submitted: 4/18/2008 3:30:31 PM : Start Price: $29.34 SMS Score: -61.86

I'll bite. It's on the high side right now but I'm gonna jump in. The demand is there and it's price is still reasonable given the math. I would've liked to jumped in sooner but oh well.

JD2985 (< 20) Submitted: 4/16/2008 9:50:23 AM : Start Price: $27.02 SMS Score: -63.33

From Cuchulainn1's blog:

"I believe that we are seeing a perfect storm for steel recyclers in the making. High commodity prices and high energy prices means greater demand for those who can recycle steel since it requires only a fraction of the energy to produce.

More importantly, a lot of the new steel mills in Asia use electric arc furnaces. The advantage for the Asian steel mills is that the electric arc furnaces use a fraction of the energy (which is increasingly expensive) compared to smelting. This is important because all these new furnaces require scrap steel... a lot of scrap steel.

What this means is that the rise in recycled steel commodities is not SPECULATIVE. The demand is very real and is consumer driven. Those who sell recycled steel to buyers in the Asian market stand to make tremendous amounts of money.

Three companies that come to mind to play recycled steel are:

1. Nucor (NUE) 94% of caps all-stars think NUE will outperform.

2. Metalico (MEA) a small cap. 98% of caps all-stars think MEA will outperform.

3. Sims Metal Management (SMS) midcap. With the recent merger SMS has passed Nucor as the worlds largest recycler of metal in the world (16 million tons, 220 locations on 4 continents) 100% of caps all-stars think SMS will out perform. (However, only 4 have rated)

Of the three, I like SMS the best. I feel that their merger was a home run and now the company has a large foothold in the USA, which is the Saudi Arabia of recycled steel.

This is a play that commodity and energy prices will remain high. This is also a play on continued Asian economic growth."

Looks like Cuchulainn was right. Sims is up almost 5% this morning on news of better than expected Chinese GDP.

xKaptainx (50.15) Submitted: 4/14/2008 10:51:21 PM : Start Price: $27.76 SMS Score: -63.69

From Cuchulainn1's CAPS Blog.

millegrazie (40.92) Submitted: 4/11/2008 11:33:11 AM : Start Price: $27.26 SMS Score: -62.19

recession resistant and follows long-term trend of increased recycling in USA as a broad habit.