Dear Reader,
U.S. Steel – we haven't talked about this one in a while.
We recommended shares (SYM: X) last year at about $31 a share and sold the stock around $48 after they announced that they were going to get acquired by Nippon Steel, a Japanese company.
===Takeover Alert===
If you still haven't read our free "Our #1 Takeover Target for September" report...
...please take a few seconds to view it right now before the report link expires.
I eventually plan to take this free report down, so do yourself a favor and check it now...
FREE: "Our #1 Takeover Target for September"
===
But last week the Biden administration said they were going to block the deal from happening, and U.S. Steel crashed about 20% on the day.
But the stock is back in play and we're taking a real close look here.
When we first started looking at U.S. Steel there were rumors they had gotten two bids from American steel companies.
They accepted Nippon's $55 bid which sent the stock up a nice 58% from where we recommended it.
We sold right away then because I believed the timing was bad for this kind of deal right before an election year…
U.S. Steel is an American icon – think Andrew Carnegie, the railroads, the building of America.
Either candidate could have announced that they don't support this deal.
But now, we're in a situation where the two or three American bidders that had emerged before this deal came and went are probably going to come back into the race. (I give the nod to Cleveland-Cliffs.)
At $29 a share it looks even better than it did back then.
So now the bigger question is, what's driving demand for U.S. Steel?
Four words: "The Inflation Reduction Act."
Poorly named, for sure – when you look at where all that money's going it's promoting domestic manufacturing in clean energy.
The CEO of U.S. Steel, David Burritt, said himself, "The Inflation Reduction Act should be called 'The Manufacturing Renaissance Act' because it is the most incredible thing we've seen in the U.S. in a long time. I couldn't be more bullish on the steel industry and I couldn't be more bullish on U.S. Steel."
Biden and Trump have both tried to give a lot of goodies to blue collar workers in America – U.S. Steel among them.
And both administrations have written bills favoring domestic manufacturing and reshoring in the wake of the threat posed by China.
U.S. Steel is a massive beneficiary of that, which is why so many companies have wanted to buy this asset.
So the headline for us here is this:
I am thinking about re-entering a position in U.S. Steel.
I'm not sure if I'm going to do that, but if I do, members of Takeover Targets will know this because that is the service where we'd recommend a takeover candidate like U.S. Steel.
In the meantime, here is a report on my No. 1 Takeover Target right now.
At around $10 a share, it's almost comical how cheap this stock has become, relative to its prospects.
That's why one billionaire dubbed "the greatest ... trader of his generation" just bought 5 million shares, bringing his total to 30 million shares.
Bottom line: it feels like train will soon leave the station on My No. 1 Takeover Target for September, and one of the best opportunities on the market will soon be gone forever.
Have a wonderful week.
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