If you own shares of a metal recycler, I imagine your screen is looking pretty green.
Pretty much everyone in the space, from Schnitzer Steel
First, we have the stellar results out of Commercial Metals
On another front, it appears that the slew of analysts covering Sims Group
Specifically, the full-year estimate is for $314 million in earnings. Backing out the past three quarters gives us an estimate of $132 million for the current and final quarter of the fiscal year. Sims says it will exceed the full-year estimate by more than 10%-15%. That means fourth-quarter earnings are probably coming in at least 35% higher than expected -- possibly better. Sims is looking far from slim.
Aside from my admiration of the man running Sims' North American operations (the former Metal Management), the macro environment for scrap recyclers is tough to beat. For that reason, I have outperform ratings on both Sims and Metalico in Motley Fool CAPS. Check out what other players have to say about either company, and it should be clear why these metal players are so dear.