The 1 Thing Titanium Cannot Do

Titanium is pretty wild stuff. Whether it's holding a jet together or just keeping your electric razor sharp, this lightweight, super-strong metal has some intriguing properties. Titanium is even being used in the cores of golf balls to keep my shot straighter. It seems the one thing titanium can't do, though, is make the stock of the companies that sell the stuff go up.

Manufacturer RTI International Metals (NYSE: RTI) gave investors a titanium-strength headache Tuesday when it undercut analyst expectations with lackluster earnings and tacked on a disturbing medium-term outlook. Second-quarter earnings per diluted share dropped 10% from the prior year to $0.81 per share. Net sales increased marginally, reflecting increased demand from commercial aerospace and defense contracts. Meanwhile, the average realized sales price for titanium products came in at about 12% below last year's figure.

Along with market leaders Allegheny Technologies (NYSE: ATI) and Titanium Metals (NYSE: TIE), shares of RTI are in the doghouse. Even after the stock's 60% decline this year, any Fools who are thinking about bargain shopping here would do well to heed the outlooks provided by CEO Dawne Hickton: "During the course of the next 12 to 18 months, we expect the challenges faced by the industry in the second quarter to continue." Once the Boeing (NYSE: BA) contract for the 787 megajet kicks into gear sometime around 2010, though, the company might forge a nice comeback.

In the meantime, I believe there are too many opportunities in some softer metals with more positive near-term fundamentals. I have suggested elsewhere that gold, silver, copper, and aluminum are poised to rise. The Fool who simply must have some titanium exposure might consider BHP Billiton (NYSE: BHP), which mines titanium, the four metals mentioned above, and a host of other valuable materials.