Long/short equity, value, special situations, growth

Constellium: Attractive Positioning In The Aluminum Industry

I am bullish on the theme of growing aluminum demand from the aerospace and automotive industries. However, it is difficult to find a good way to play that theme. Alcoa (NYSE:AA) and Century Aluminum (NASDAQ:CENX) are battling weak aluminum prices. I like Kaiser Aluminum (NASDAQ:KALU), but it is facing headwinds in 2014 from an inventory overhang in the aerospace markets. This brings me to Constellium (NYSE:CSTM). Constellium is a downstream aluminum producer, like Kaiser Aluminum, but Constellium is better positioned to deal with the aerospace inventory overhang. Constellium has less exposure to aerospace and 90% of its aerospace business is contract-based, not based on spot prices. In this article I will analyze...

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