October 11, 2018

I bought steel – that’s why I’m buying more with SSAB



You may remember: We recently recommended and bought German steel producer Salzgitter – which usually goes hand in hand at Obermatt. The steel industry is having a tough time these days: prices have dropped, the US has imposed punitive tariffs. However, these are good news for investors because stock prices have fallen as well.

This is what Warren Buffett once said on this topic: "I get fearful when others are greedy and greedy when others are fearful." This philosophy is a key element of our analyses: When prices are falling, the Obermatt rankings go up – and vice versa.

Steel is a safe value. For a long time, we’ve been needing it for bridges, buildings, cars, and machines, and nothing will change about that for the foreseeable future. The question is, which steel stock is the most promising one? The four biggest producers in Europe currently look like this:

Obermatt European steel market analysis SSAB

We already bought Salzgitter, the company with the best combined rankings. One argument for Voestalpine is the high combined rank of 85. That means 85% of their competitors have worse rankings than the Austrian steel producer. ArcelorMittal is the biggest steel company in Europe, which is also a good argument. And SSAB, formerly Swedish Steel, has the best value rank, meaning you get the most for your money.

Preferably, Obermatt CEO Dr. Stern would like to put all three stocks into his portfolio. However, one of his most important principles is to invest slowly. In addition, safety is very important to him at the moment, because he has been expecting a correction on the stock markets for a long time. SSAB has the highest safety rank with 67, which means they don’t have a lot of debt and liquidity is high. That is what decides it for Dr. Stern. He's buying SSAB shares for 5,000 francs. What are you buying? You can use our top 10 lists as inspiration.



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