Topic: How To Invest

Stock Pickers Digest Hotline – Friday, June 1, 2018

Article Excerpt

RUSSEL METALS INC., $29.29, symbol RUS on Toronto, is one of North America’s largest metal distributors, serving 28,000 clients at 51 locations in Canada and 12 others in the U.S. Canadian steelmaker Stelco, symbol STLC on Toronto, dropped this week after the Trump administration announced it will impose tariffs of 25% on imported steel and 10% on imported aluminum from Canada, beginning at 12 a.m. Friday. Russel also dropped on the news, but quickly reversed most of the drop. That’s because the company is a steel distributor, rather than a producer. Russel distributes steel as well as processes it into products according to customer specifications. It generates about 30% of its revenues in the U.S. Restrictions on steel imports into the U.S., such as tariffs, push up the price of steel in that country. In the short term, it raises the value of Russel’s steel inventory. At the same time, the company passes on any price increases directly through to its customers. OUR RECOMMENDATION:…