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Metalico Inc. (AMEX: MEA) – Full of Business and Sustainability Values

Environmental conservation and the Iron & Steel Industry have traditionally been at loggerheads, but modern society needs iron and steel products. Hence, every sustainability move by corporations that use these and other metals should be especially welcomed by all stakeholders. That is why the potential profits generated by this stock have additional value for investors.

The company has multiple recycling plants. They are mainly located in Western New York. The company saves on marketing and distribution costs by focusing on regional customers. It recycles various kinds of metals. Some of the output goes to its own subsidiaries. Steel mills, furnaces, smelters, and foundries are major categories of external clients.

The company sources industrial scrap from large users and from trade dealers as well. It also accepts materials from auto wreckers, demolition firms, and small peddlers. Its wide network of sources gives the stock stability.

The company is versatile in its recycling capabilities. It can sort scrap, break as well as cut, and can meet downstream client requirements in terms of sizes and shapes for recycled metals of various kinds. This protects the stock from competitive pressures during monthly bidding for supply contracts.

The management has acquired specialized molybdenum, tantalum, and tungsten recyclers. It has also integrated vertically by acquiring a controlling interest in a manufacturer of catalytic devices. These strategic moves make the stock a reliable profit and growth generator. The nature of the business helps conservation aims at the same time.

Annual Sales Growth has more than doubled over the last four quarters. Five year Capita Spending Growth has been more than double the rate achieved by the Iron & Steel Industry. However, Total Debt is still well below Equity. It is a growth stock of choice in today’s market.

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