Topic: How To Invest

Pat: I have Methanex in my portfolio. How do you see the stock? Is it worth keeping?

Article Excerpt

A: Methanex Corp., $38.80, symbol MX on Toronto (Shares outstanding: 89.8 million; Market cap: $3.5 billion; www.methanex.com), is a Vancouver-based methanol producer and distributor. It is, in fact, the world’s largest supplier, with an estimated market share of 15%. The company produces 55% of its methanol in New Zealand and Trinidad (where it holds a 63.1% stake in Atlas Methanol). It makes a further 25% in the U.S., 8% in Egypt, 7% in Medicine Hat, Alberta, and 5% in Chile. In addition, Methanex resells methanol produced by others. Also known as wood alcohol, methanol is usually made by mixing natural gas with steam to create a liquid. That then gets distilled to create pure methanol. It is a clear, liquid hydrocarbon that is water-soluble and biodegradable. Methanex buys most of the natural gas it needs under contracts that tie its cost to the selling price of methanol. That helps cut its risk. Many…