This column was originally published on RealMoney on Oct. 18 at 9:38 a.m. EDT. It's being republished as a bonus for TheStreet.com readers.
These mineral stocks confuse and bedevil people. They are cheap on their multiples. They have given up a lot from their high-water marks. But they are also no longer a monolith.
Aluminum is in a glut, after being tight. Steel was very tight, and now you have consolidation and low multiples going for you; but that may not be enough. I believe that only titanium has real upward momentum because of its tie-in with aerospace. (
are the plays there.)
Iron? Very hard because you have to worry about China all of the time. Lead? Too small. Gold works, but not in an environment where we don't have the metal with momentum -- under $600 is
momentum -- and the gold companies themselves, with the exception of
don't seem to have enough supply themselves to meet the demand.
And that leaves copper. Copper is still in short supply even though there is a lot of smelter strength. You have
( PD) sitting out there with a kill-or-be-killed attitude. It either needs to do a deal or it needs to be acquired. And you have
, which has both gold and copper but reported
declining output when it posted earnings yesterday.
I think that means that this is the best mineral to play if you believe there will be a rebound. On last night's "Mad Money" TV show, I spoke to Fred Poses, the honest and terrific CEO of
( ASD). He's a big buyer of copper and he said that he fortunately is hedged going forward. I wonder if everyone else was that smart.
I doubt it. And that's another reason why, even in an American housing slowdown, I want to be in this metal. China's the marginal buyer, not the U.S., and last I looked they are still building aplenty in their markets.
To view my interview with Poses, click here.
At the time of publication, Cramer had no positions in stocks mentioned.
Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for
Action Alerts PLUS. Listen to Cramer's RealMoney Radio show on your computer; just click
here. Watch Cramer on "Mad Money" at 6 p.m. ET weeknights on CNBC. Click
here to order Cramer's latest book, "Real Money: Sane Investing in an Insane World," click
here to get his second book, "You Got Screwed!" and click
here to order Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column by
TheStreet.com has a revenue-sharing relationship with Traders' Library under which it receives a portion of the revenue from Traders' Library purchases by customers directed there from TheStreet.com.