ArcelorMittal Sa Luxembourg

ArcelorMittal Sa Luxembourg (MT - Snapshot Report), the world's largest steel company, offered some good news last week amidst investor panic about a global commodities slowdown, especially in the steel sector.

On Oct 9, the company reaffirmed third-quarter guidance in excess of $8.5 billion. MT also expects cash flow from operations to be higher in the second half of 2008 versus the first half, which was a record $13.1 billion.

"Despite the current financial crisis, the Chinese economic slowdown and the strong destocking taking place on steel markets, we are pleased to expect profitability improvement in the second half of this year", said Lakshmi N. Mittal, Chairman and CEO.

Analyst's estimates for the third quarter are up 1 cent in the last week to $4.04. For the full year, estimates have fallen 8 cents to $12.61 in the last week, but estimates called for $12.61 sixty days ago as well. 1 out of 8 analysts has cut full year estimates in the last 7 days.

ArcelorMittal was a Zack #1 Rank (strong buy) stock when we last reviewed it on Apr 8 but is now a Zacks #2 Rank (buy) stock.

The stock is now extremely cheap, trading at only 2.5x forward earnings compared to 10.6x forward earnings last April. Its price-to-book is now 0.51, well under the industry average of 1.15.

MT surprised on estimates in the second-quarter by 49.11%, or $1.38, posting $4.19 compared to analysts' estimates of $2.81. ArcelorMittal reports third-quarter earnings on Oct 30. Read the Apr 8 analysis.

Update to Previous Value Zacks Rank Buy Stocks

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Bucyrus International, Inc. (BUCY - Snapshot Report), the mining equipment manufacturer, has seen its stock pummeled in the commodities sell-off and market rout. But Bucyrus' fundamentals are solid and the stock is an attractive value pick at this level. It has surprised on estimates 4 consecutive quarters by an average of 25.83%. With the stock selling off, it now trades with a forward P/E of only 8.60. Read the Oct 8 analysis.

Terra Industries, Inc. (TRA - Snapshot Report), the nitrogen fertilizer company, is now incredibly cheap, trading at only 2.8x projected earnings, yet fundamentals remain intact. TRA has surprised on estimates the prior 2 quarters by an average of 30.11%. Read the Oct 9 analysis.

Elizabeth Arden, Inc. (RDEN - Snapshot Report), which sells upscale beauty products around the world, is counting on its celebrity fragrance brands to counter the economic downturn. RDEN has surprised on estimates 2 of the last 4 quarters. Elizabeth Arden has a forward P/E of 8.95. Read the Oct 10 analysis.