Tarnished Steel

U.S. Steel is as bad as the bears thought. The equity offering, the covenant problem, the earnings -- all bad.

One is reminded of Alcoa (AA - commentary - Cramer's Take), which had to take similar action. The difference is that U.S. Steel's prospects were considered to be better than Alcoa's -- I didn't know a soul who believed in Alcoa, but there are some who still think that U.S. Steel is a buy.

I got frustrated with U.S. Steel when CEO John Surma wouldn't come on Mad Money despite the dramatic decline in the stock. Many analysts questioned this stock, but it was intriguing because it was down more than during the Great Depression.

We have to wait to see where the deal is. I had been recommending it as an accidental high-yielder, but when it bounced from the low to the high 20s and Surma wouldn't come on after a very critical research piece predicted pretty much everything that happened last night, I am glad I abandoned ship.

U.S. Steel is a tough one. People like the steel business, but it is just proving to be too hard to own vs. the technology stocks. I would take a pass until we see where the deal is priced.

At the time of publication, Cramer had no positions in the stocks mentioned.

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Know What You Own: Other metal fabrication companies include Precision Castparts (PCP - commentary - Cramer's Take), Reliance Steel & Aluminum (RS - commentary - Cramer's Take), Valmont Industries (VMI - commentary - Cramer's Take), Matthews International (MATW - commentary - Cramer's Take) and Mueller Industries (MLI - commentary - Cramer's Take). For more on the value of knowing what you own, visit TheStreet.com's Investing A-to-Z section.

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