Bought Some Steel Stock, & Wrigley Options

Today I opened a position of 3,558 shares at $28.09 in a steel holding company called Mittal Steel Company NV (MT), for a current value of $99,730. In addition, I decided to learn more about options trading, and bought 10 contracts of Wrigley (WWY) call options at $65 per share to expire on the 3rd Friday in March. I paid $3.6 per option, which are currently valued at $3,500. I am basically hoping for a very positive bump up in the stock price after the company's February 7th earnings announcement. William Wrigley Jr. Company was most recently analyzed when I opened the long position in the virtual portfolio, under the post: A Sweet Tooth for Wrigley's Stock Price.

The Mittal Steel Company buy was a value play, in part thanks to a great article in Forbes.com, written an astute money manager named Ken Fisher:

• "The world's largest steelmaker, Holland's Mittal Steel (28, MT), operates in 14 countries, producing 60 million tons a year. By ably controlling costs, it makes fat margins in a business where few do. Mittal trades at 6 times likely 2006 earnings."

Currently, Mittal Steel trades at a trailing price/earnings of 4.41, and a forward price/earnings of 6.19. It has a dividend of $0.40, which comes out to a dividend yield ratio of about 1.40%. The debt/equity ratio is lower than the industry average of 0.43, coming in at only 0.36. In addition, the company has a net profit margin of 17.7%, and an incredible income growth rate of 209.1%.

More financial news about Mittal Steel:

Morningstar.com: Why Do Stocks Get Cheap? - "...we currently have a 5-star rating on Mittal Steel, the world's largest steel firm. Steel is a tough industry, but not tough enough that a company with a fully funded pension plan, an investment-grade credit rating, and dominant market positions throughout the world can't offer an attractive return when it's priced at just 5 times earnings."

The Economic Times, India: Mittal Steel ropes in SAIL - "DELHI: Mittal Steel today announced the appointment of Sanak Mishra as CEO of Mittal Steel’s 12-million tonne per annum Jharkhand greenfield project."

nwitimes.com: U.S. Steel a takeover target? - "U.S. Steel Corp. could be the takeover target of foreign steelmakers wanting to enter the U.S. automotive steel market, analysts are speculating."